Location: Bristol

Loan Amount: £530,000

Finance Category: Commercial Property Finance

The Story

In 2024, Fox Davidson, a leading Bristol-based mortgage brokerage, demonstrated its expertise in property finance by successfully securing a £530,000 bridging loan for a client with ambitious plans. The client aimed to purchase a 3-bedroom semi-detached property and convert it into a lucrative 5-bedroom House in Multiple Occupation (HMO). This case study delves into how Fox Davidson navigated the complexities of arranging the bridging loan, enabling the client to refurbish and extend the property into a high yield HMO buy to let property.

The Challenge

The client approached Fox Davidson with a vision to turn a traditional 3-bedroom property into a high-yield 5-bedroom HMO in Bristol. Understanding the unique financial needs of property development, Fox Davidson quickly assessed the situation and identified a refurbishment bridging loan as the optimal solution.

Thorough Assessment:

Fox Davidson conducted a comprehensive analysis of the HMO refurbishment project. We looked at profit on cost, analysed build costs, timescales, and the gross development value (GDV). Our overall assessment of the project feasibility, and the potential return on investment was sound. This thorough assessment allowed us to tailor the best financial solution to the client’s specific needs.

Strategic Lender Selection:

Leveraging our extensive network of lenders, Fox Davidson identified a lender willing to provide a £530,000 bridging loan at favourable terms. The selected lender recognised the potential of the project and demonstrated flexibility in accommodating the client’s requirements.

The Solution

Efficient Application Process:

Our team streamlined the application process, ensuring that all necessary documentation was prepared and submitted promptly. This efficiency was crucial in expediting the loan approval process, allowing the client to move forward with their property development plans.

Property Development Journey:

With the bridging loan secured, the client commenced the property transformation, converting the 3-bedroom semi-detached house into a modern and spacious 5-bedroom HMO. The client extended to the rear of the property and into the loft, all of which fell under permitted development finance. Fox Davidson maintained close communication with the client throughout the development phase, offering support and guidance as needed.

Timely Disbursements:

The refurbishment bridging loan funds were disbursed in a timely manner, facilitating the smooth progress of the project. This timely financial support allowed the client to maintain a consistent construction schedule. 

Responsive Client Support:

Fox Davidson’s dedicated team remained responsive to the client’s evolving needs, addressing any concerns or challenges that arose during the development process. Our commitment to client satisfaction played a pivotal role in the successful completion of the property transformation.

Transition to Long-Term Investment:

Once the property was meticulously refurbished and extended, Fox Davidson continued to support the client’s financial goals by arranging a buy-to-let mortgage. This strategic transition enabled the client to retain ownership of the newly developed HMO property and capitalize on the long-term rental market in Bristol.

Seamless Transition:

Fox Davidson facilitated a seamless transition from the bridging loan to a buy-to-let mortgage, leveraging our industry expertise to navigate the intricacies of property financing. This transition ensured continuity in financial support for the client’s investment journey.

Optimised Mortgage Terms:

By leveraging our relationships with a diverse range of lenders, Fox Davidson secured a competitive buy-to-let mortgage with favourable terms. The optimized mortgage terms positioned the client for sustainable rental income and capital appreciation.

Fox Davidson’s success in securing a £530,000 bridging loan for the transformation of a 3-bedroom property into a 5-bedroom HMO in Bristol exemplifies our commitment to delivering tailored financial solutions for property development. Our strategic approach, efficient processes, and ongoing support allowed the client to realise their vision, and the subsequent transition to a buy-to-let mortgage ensures a lasting and profitable investment. 

If you are considering a bridging loan for an HMO property in Bristol, Fox Davidson stands ready to guide you through a successful financial journey. To discuss your bridging loan or development finance with a Bristol mortgage broker please do get in touch.