Covid debt doesn’t block property refurbishment

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BFS has provided a bridging loan to a client with poor credit, yet keen to stay on the property ladder, having acquired a mid-terrace flat in East ham, London, via auction.

Unfortunately, the acupuncturist fell into a mortgage and household arrears due to a lack of income during Covid. This resulted in him being given several CCJ’s. However, he was determined to find a solution that would enable him to get back onto the property ladder and build his credit profile.

Identifying a property at auction, the client proposed a 12-month bridging loan, allowing him to purchase the property outright, as a mortgage would not be obtainable in the necessary time frame coupled with the adverse credit.

Upon purchase and during the bridging loan term, the client will rebuild his credit profile and ultimately obtain a traditional mortgage once the 12-month term has ended.

Becky Myers of BFS explained: “Inevitably, a lot of people are still feeling the financial strain placed on them through Covid and are navigating their way through. We are dealing with several similar cases whereby clients have incurred debt and bad credit as their income had been detrimentally affected during the lockdown.

“We worked closely with this client to ensure they had a clear exit strategy. Ultimately, a bridging loan has enabled them to stay on the property ladder, purchase a property through auction and give them the space to improve their credit profile, ultimately re-mortgaging with a high street lender.

“Our ability to take an independent and holistic view, coupled with the speed at which we operate, meant that the client has acquired the property at a competitive price and is a homeowner once again.”

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