Location: Lincolnshire
General Background
Elderly owner of a small mixed farm passed away. The farmhouse and land were bequeathed to the son and daughter, probate value £650,000. The son worked and managed the farm but the daughter had no interest in farming. The son needed to get a bridging loan to pay out his sister so a bridge of £325,000 was required.
Finance Background
- Finance Background
- Partnership
- Property was mortgage free
- Business generated a small profit
- Son paid a salary by the farm business, reasonable credit score
- Small business overdraft
- Probate due to be cleared
Alchemy Funding Approach
- Type: Bridging Loan
- Term: 12 months
- Loan to value: 55%
- 12 months interest, setup and exit fees are prepaid and added to loan so no income or affordability required
- Discussions established with 3 banks to provide an exit mortgage after the bridge
Security
- First charge on land and farmhouse
Rate
- Set up fee – 5%
- Exit fee – 1%
- Interest – 1% per month
