Our client purchased a former children’s care home, which was already set up as an un-licensed HMO (House of Multiple Occupancy).
We don’t usually lend on care homes, but we could see the potential with this deal which had been provided by one of our strongest introducers. This gave us the confidence that the borrower had experience in what they were looking to do.
The property sold via sealed bids through the agents with 7 offers in total, the market in the area was very strong and demand for HMO rooms was high. Our clients planned to apply for a 15 Bed HMO license.
Our loan completed in July 2017 with an 8 month term, the project was completed early and the HMO license obtained, our loan was redeemed after only 4 months with the exit being refinance. We lent 70% of value, at a rate of 0.8% per month.
We are looking forward to working with these clients again in the future.