Hampshire Trust Bank (HTB) has launched a Heavy Refurbishment finance product, broadening its property finance options.
- The product offers a rate of 0.90% per month with terms extending up to 24 months.
- Borrowers can access initial funding up to 70% of the current property value, with a limit on loan-to-GDV ratio of 70%.
- A minimum loan of £150,000 is set, with refurbishment costs capped at £1 million.
- Funding distribution occurs in five phases, requiring asset manager verification for cost validation.
Hampshire Trust Bank (HTB) has expanded its property finance portfolio with the addition of a Heavy Refurbishment product, aimed at meeting the needs of landlords and property developers. The product is designed with a keen understanding of current market demands, offering a competitive monthly rate of 0.90% and maximum terms of 24 months.
HTB’s new refurbishment loan allows for initial day-one funding of up to 70% of the current property valuation. Coupled with this is a maximum loan-to-Gross Development Value (GDV) ratio capped at 70%, which includes the interest to be rolled into the loan. This provides substantial upfront capital to finance the refurbishment work.
Starting at a minimum threshold of £150,000, borrowers can undertake significant property projects, as long as total refurbishment costs do not exceed the limit of £1 million. These projects must include any contingencies or self-financed elements within this cap. The stringent requirement for independent verification of costs by asset managers ensures financial prudence and accuracy.
A unique feature of this product is its phased funding model. The total refurbishment funding is released in arrears, divided across up to five pre-agreed tranches. Each tranche disbursement requires prior approval and cost verification, ensuring thorough oversight and control throughout the refurbishment process.
Lorenzo Satchell, HTB’s sales director of bridging, highlighted the strategic intent behind this product: acknowledging a strong demand for such financing solutions among landlords seeking better yields through property extensions or conversions, often under permitted development rights. Satchell emphasized the agility and flexibility the product provides, crucial for realising such projects.
Alex Upton, managing director of specialist mortgages at HTB, reinforced the strategic significance of the Heavy Refurbishment launch in aligning with HTB’s broader strategy to offer adaptable and tailored solutions to brokers, particularly for complex client requirements. Upton stated the bank aims to empower brokers by ensuring readily available funding options and direct access to key decision-makers.
Hampshire Trust Bank’s introduction of the Heavy Refurbishment product illustrates its commitment to providing innovative financing solutions for property development.
