Specialist bridging lender Somo has completed a £1,645,000 bridging loan at 70% loan-to-value to refinance an expiring facility on a converted London mansion, delivering a lower-cost solution within 14 days of the initial enquiry.
The deal provided a developer with the time and financial flexibility needed to market the property properly and achieve the best possible sale price, rather than being forced into a rushed exit by an uncooperative existing lender.
The problem: an expiring facility and no extension on offer
The borrower had purchased and converted a large London mansion into an investment property intended for resale. With the project nearing completion, the existing bridging finance term came to an end before the property had been sold. The outgoing lender declined to extend the loan at the same interest rate, leaving the developer facing higher borrowing costs at precisely the point when additional time was most needed.
The refinance needed to achieve three things: repay the existing lender in full, buy additional time to market and sell the property, and avoid the cost increase that would have come with extending on the original lender's revised terms.
How Somo structured the deal
Somo structured the facility as a first charge bridging loan through its Standard Bridge product, completing within 14 days. The speed of execution was critical, given the deadline imposed by the maturing facility.
The outcome across all four objectives was as follows:
- Existing lender repaid in full
- Nine-month extension secured to allow proper marketing and sale
- £100,000 in additional capital released
- £2,000 in legal fees recovered
The refinance allowed the borrower to maintain momentum across their wider portfolio while focusing on maximising the eventual sale value of the mansion.
"This is exactly where bridging should make things easier, not harder," said Rob Johnson, underwriting director at Somo (pictured). "By taking a pragmatic view, we delivered a fast refinance that gave the borrower time, flexibility and a better cost position."
What this deal illustrates for property developers
Expiring bridging facilities are among the more common pressure points for property developers, particularly where a sale takes longer than anticipated or a conversion project runs close to its original timeline. In those situations, the willingness of a new lender to move quickly and price competitively can be the difference between a controlled exit and a distressed one.
For London residential developers managing active portfolios, the ability to refinance an expiring bridge without a rate increase and without sacrificing weeks to a slow process has obvious value. Somo's 14-day completion on a deal of this size and complexity demonstrates that fast bridging refinance solutions remain available in the London property market, even where the existing lender is unwilling to play ball.
As property sales timelines remain variable across prime London residential, demand for flexible refinancing of this kind looks unlikely to ease.
