Build it
Build it
Development finance
Ground-up, conversion and part-built schemes, from site purchase to exit.
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Development finance
Which cap binds, loan to cost or loan to GDV, and the real day-one equity.
Build to Rent development
Underwritten on stabilised yield and DSCR, not sales rate.
Mezzanine and stretched senior
The gap between senior LTC and what you can fund, and the true blended cost.
Heavy refurbishment and conversion
Where refurbishment stops being a bridge: structure, change of use, drawdowns.
Part-built and rescue finance
Valuing an unfinished asset when the contractor has gone.
Bridge it
Bridge it
Bridging finance
Short-term debt where the deadline, the asset or the exit will not wait.
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Purchase bridge
Completing before the money is in place: chain breaks, tight deadlines, unmortgageable stock.
Development exit finance
Off development debt at a lower rate, to buy sales time and release equity.
Auction finance
A 28-day clock, and what must be in place before the hammer falls.
Pre-planning and planning gain
Lending against current value with planning upside.
Below market value purchase
Day-one lending against open market value rather than price.
Second charge and capital raising
Raising against existing assets, and first-charge consent.
Light refurbishment finance
Bridge plus refurb tranche, and where the development boundary sits.
Also structuredBridge to let and refinance
Hold it
Hold it
Mortgages and term finance
Long-term debt against income, once the asset is built, let or trading.
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Buy to let mortgages
ICR stress testing, limited company against personal, portfolio rules.
HMO mortgages
A higher cover test, licensing, and the two valuations a lender takes the lower of.
Commercial term, investment
Tenant covenant and lease term, and why DSCR sets the loan.
Commercial term, owner-occupier
Trading accounts and EBITDA rather than rent roll.
Portfolio refinance
Cross-collateralisation, and one facility against individual loans.
Stabilisation and term refinance
The income test replacing the GDV test, and the letting void before term debt engages.
Co-living and PBSA
An operational asset valued on income, and the operator covenant.
Run it
Run it
Business finance
Funding the business behind the property, secured on the ledger, the equipment or the covenant.
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How we work
Case studies
Articles
Tools
Development finance calculator
Size the facility against site cost, build cost and GDV.
Development exit calculator
Refinance the development facility and release equity at PC.
Bridging finance calculator
What a bridge costs, and what actually clears on day one.
Refurbishment finance calculator
Fund the purchase and 100% of the works, with interest rolled to exit.
BTL rental cover calculator
The rent a buy to let must achieve to clear a lender's cover test.
Commercial mortgage calculator
What a commercial property's income will support, and what it costs.
About
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Hold it › Commercial term, investment
A commercial investment property is underwritten through its tenant. The building matters, the location matters, but the question a credit committee asks first is who pays the rent, how strong they are, and how long they are committed for.
That makes debt service coverage the binding test rather than loan to value on most cases. A well let building at a modest loan to value can still be constrained if the income does not cover the debt by the required margin at a stressed rate, and a strong covenant on a short unexpired term is treated as a weaker asset than the yield suggests.
Unexpired lease term against loan term is the detail that catches people. A five year facility behind a lease with three years to run means the lender is taking two years of letting risk, and will price, shorten or decline on exactly that basis.
Set the rent and the value and see the loan the income supports.
Covenant assessed the way credit will assess it
Accounts, trading history and sector, not simply a recognisable name. A strong-looking tenant with thin accounts is a covenant question, and it is better raised by us than discovered in underwriting.
Lease term matched to loan term
Where the unexpired term is shorter than the facility, we structure around it: a shorter loan, an amortisation profile, or a reletting reserve. Ignoring the gap is what turns a good asset into a declined application.
DSCR modelled at a stressed rate
Coverage is tested at a rate above the one you pay. We run that first, because on most commercial investment cases it is the number that sets the loan rather than the valuation.
The asset without the tenant
Alternative use, re-lettability and void cost. Every lender is pricing the day the tenant leaves, whether or not they say so, and an asset that re-lets easily borrows better.
Which lenders play here
Challenger banks, specialist commercial lenders and, for stronger covenants and prime stock, the clearing banks. Sector appetite drives everything here: the same building with a different tenant is a different transaction, and retail, leisure and industrial are treated very differently.
Indicative, and not an offer. What a lender will actually do depends on the scheme, the borrower and a full valuation.
What to have ready
Bring these and we can tell you where you stand.
Each one is something a lender will ask for. Having it early is the difference between a fast answer and a slow one.
✓The property, the price or value, and the tenure
✓The lease: tenant, rent, unexpired term, breaks and repairing obligations
✓Tenant accounts, or whatever covenant evidence exists
✓Your deposit and the structure you intend to hold it in
✓Any capital expenditure the building needs, and when
✓Your intention: hold for income, reposition, or hold to sell
Related case study
£1.2m Semi-Commercial Bridge and Refinance to Commercial Mortgage
Related
Worth reading on this
Article
Commercial Mortgage Rates: What Sets Yours
Case study
£1.2m Semi-Commercial Bridge and Refinance to Commercial Mortgage
Next
Related in this pillar.
Common questions
The questions this product raises.
What makes a tenant a strong covenant?
Their accounts, trading history and sector, not a recognisable name. A credit committee asks first who pays the rent, how strong they are and how long they are committed for. A well-known tenant with thin accounts is still a covenant question, and it is better raised before you apply than found in underwriting.
Does the tenant's sector change the terms?
Yes, a great deal. Lenders treat retail, leisure and industrial very differently, and appetite for a sector can decide the case on its own. The same building with a different tenant is a different transaction, so expect the lender list to change with the tenant, not just the price.
What does a lender assume about the tenant leaving?
That it will happen, and it prices for that day whether or not it says so. Alternative use, how easily the unit would re-let and the cost of a void all feed the terms. A building that re-lets easily borrows better than one that only suits its current occupier.
What will a lender want to see on the lease?
The tenant, the rent, the unexpired term, any break clauses and who carries the repairs. Add any capital spending the building needs and when, because a lender reads a roof or a heating system due for replacement as a cost against the income.
Bring us the detail.
Send what you have. We will tell you what is fundable and what needs work before anyone approaches a lender.
Specialist property finance for developers who want the numbers to survive underwriting.
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Fundingwise Limited is not authorised or regulated by the Financial Conduct Authority, and arranges unregulated finance only. That means lending secured against commercial property, or against residential property that is not, and will not be, occupied by the borrower or an immediate family member as a main residence. We do not advise on or arrange regulated mortgage contracts or regulated bridging loans. Because this finance is unregulated, FCA conduct rules and access to the Financial Ombudsman Service do not apply. Fundingwise Limited is registered in England and Wales, company number 13750788.