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Bridging Case Study: Newport HMO Auction Purchase

Bridging Case Study: Newport HMO Auction Purchase

Our team recently facilitated a bridging loan for two experienced landlords aiming to quickly secure a new investment opportunity. The clients acquired a five-bedroom HMO-ready property at auction using funds obtained with our help through another property they had developed.


This case study details the transaction, objectives, and successful execution of the bridging loan strategy.



Clients’ Profile

  • Background: Two experienced landlords and property developers.

  • Objective: Quick acquisition of an HMO-ready property at auction.


Property Details

  • Location: Newport City Centre.

  • Type: Five-bedroom end terrace property, already configured as an HMO.

  • Features: The property includes a lounge, WC, dining room, kitchen, and a double bedroom on the ground floor, along with four bedrooms, a bathroom, and a shower room on the first floor. It also has a low-maintenance patio garden.

  • Condition: The property was in a lettable condition with only minor snagging needed.


Financial Overview

  • Auction Purchase Price: £203,000

  • Initial Gross Loan: £230,750

  • Gross LTV: 65%


Transaction Dynamics

  • Funding Purpose: The bridging loan was secured against an existing unencumbered six-bedroom HMO property owned by the clients. This strategy provided them with the liquidity needed to participate in the auction.

  • Process: The application for the bridging loan was expedited and completed within one week, highlighting our commitment to providing swift and reliable financial solutions. We only cooperate with valuers & solicitors who can work within the required timeframes. 

  • Property Refurbishment: No significant refurbishment was required as the purchased property was already HMO-ready and in a lettable state.


Exit Strategy

  • Refinance: the exit plan involved refinancing the five-bedroom property onto a term loan. A broker confirmed that the expected rental income was ample to support the term loan, providing a stable and profitable exit from the bridging loan.


The case exemplifies the strategic use of bridging loans to facilitate the rapid acquisition of investment properties at auction. By leveraging their existing HMO property to secure necessary funds, our clients efficiently executed their investment plan. This transaction showcases our ability to support property professionals with tailored financial solutions that align with their investment timelines and goals.

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