We were approached by a broker whose client – a landlord and publican was looking for finance to complete a conversion project.
In January 2016, the client had purchased a public house with a large garden and attached barn. He had planned to renovate the pub, turning the upstairs floors into rental accommodation and convert the barn into a three-bed house.
A year on, the client had completed the renovation works on the pub and started the barn conversion, unfortunately funds were now running low.
The client wanted short-term finance for 12 months to cover the costs. He had also requested no exit fees, as he hoped to complete the build in a shorter timescale.
One issue for the client was that his trading limited company accounts showed significant losses over the last three years, which would deter most lenders.
Keystone, however took a view on the losses and happy with the client’s personal credit score and experience in similar projects deemed him a good risk.
The following terms were offered.
Property value: £600,000
Loan amount: £250,000
Rate: 0.85% pcm
Term: 12 months
Borrower: Trading limited company
Monthly payment: £2,175
Estimated rental income: £2,500 pcm (when complete)
Lender facility fee: 2% (£5,000)
Broker proc fee: 0.50% (£1,250)