Residential Property Finance
Various factors will influence the best mortgage or liquidity option for you. The speed with which you are looking to obtain liquidity, the assets you are securing the loan against and the complexity of your personal situation will all play a part.
Considering all these factors, we will advise you on the best course of action to obtain a mortgage or loan. It's worth noting that you may find that the offer which best fits your needs and you are most happy with isn't always the cheapest option. Flexibility or advantageous conditions can be more attractive than a marginally competitive rate, for example, especially when speed is essential and you are looking to secure liquidity quickly.
The Mortgage Process
Enness will secure one or more mortgage or financing options that will meet your needs. On a practical level, every lender follows its own procedures, and the application process will vary, depending on whoever you are applying to. Some institutions have very rigid and formulaic analysis processes, and others approve applications after a personal review of your application and situation.
We play a central role in the whole transaction from start to finish, working alongside all parties to deliver the best option for our clients, in line with their objectives.
Equity Release and Refinance
Historically there has always been a demand for equity release schemes involving high-value properties and high-net-worth clients. The opportunity to release capital from a high-value property and invest elsewhere with a higher rate of return makes sense.
As any equity released from your property would still need to be paid back in the form of a mortgage or short-term loan, you will still need to adhere to various lending criteria. Historically, retail banks tend to have a more rigid approach to equity release transactions, while private banks and niche lenders are more flexible. That is not to suggest that retail banks are not competitive, as many will be for straightforward transactions, but for more complicated issues, the use of private banks is often more advantageous.
Development
Property development finance is a solution required for property developers to fund the construction of a project, be it for new developments or the conversion and refurbishments of residential or commercial land and property. This type of property finance is usually in the form of a short-term loan, although there are an increasing number of options available on the market to meet your requirements.
Property development finance usually comes in the form of a short-term loan, which can be broken down into two parts. The first part is designed to help you with the purchase of a site, and in many cases, a lender will advance a percentage of a purchase price and leave you to fund the remaining amount (although lenders vary on this point).
The second part of the loan is to finance the build of the project. Generally speaking, a lender will often advance the total cost for this in stages, as and when they are completed. The lender will then certify the work and funds for each stage so you can pay suppliers. This means you will often need to have sufficient cash flow to fund the initial stages of the project until you are reimbursed.
Bridging
Bridging finance comes in many shapes and forms, from auction finance to development finance, refurbishment finance, to property finance and more. The relatively short-term nature of bridging finance can be challenging, requiring experience, contacts and negotiating skills to secure the best possible terms with as much flexibility as possible. Extremely competitive interest rates, staged funding release to save on interest and utilising assets and income as security are vital elements of bridging finance deals. We excel in these areas as well as pre-arranging cheaper traditional refinancing of bridging loans at the end of the term - thereby adding a welcome degree of security.
Assets Under Management vs Dry Lending
In the past, private banks were the 'go-to' institutions for securing loans of more than £1 million. However, this was usually only possible for clients who had already had assets under management (AUM) with the bank. A general rule of thumb was that a private bank would require at least 25% of the loan value in AUM before granting a loan.
As the mortgage market becomes more competitive, however, 'dry lending' is increasingly common. Dry lending is the practice of banks offering preferential rates to borrowers who do not already have assets with the bank. In essence, assets in any bank are considered when looking at affordability ratios and repayment schedules, without borrowers being obliged to set up banking relationships to secure a loan. As an independent player with excellent contacts in commercial and private banks, Enness is perfectly positioned to take advantage of competition between banking groups and seek dry funding possibilities for our clients.
