Do you have a client looking to purchase their next investment property at auction? Or are they buying a property that they intend to renovate and sell? Do they need access to funding quickly? If so, Mercantile Trust can help!
We are specialists in providing auction finance to those borrowers who are underserved by the market.
- Lending up to 75% loan to value (LTV)
- Individuals and limited companies
- Smaller loan amounts (from just £25,000)
- First time landlord/first time buyers with no rental history up to 65% LTV
- Free and in-house legals, AVMs for fast transactions
- Customers with credit problems considered
- Second charge bridging loans available
- Properties in England, Wales, Scotland, Northern Ireland
Auction finance is a bridging loan which is secured on either the property the customer is buying or another property they own within the portfolio to purchase the property at auction. Bridging finance is a short-term solution, typically for no more than 18 months whilst putting in place a longer-term borrowing facility.
If your customers are looking to hold the asset Mercantile Trust can also provide the exit as we also offer buy-to-let term mortgages.
Call our advisers today. Your customers could get a lending decision in just one call.
Why choose Mercantile Trust?
Customers value our common sense and flexible approach to lending, as we recognise that one size does not fit all. If your customers are looking to purchase an unusual property, their circumstances require personal consideration, perhaps they’ve had credit history issues, or for any other reason they are struggling to borrow, we could be the lender for them.
FAQ's:
What is auction finance?
Auction finance is the use of a bridging loan for property auction purchases. A bridging loan is a short-term loan (usually between £25,000 - £500,000) and is suited for those who need to capital raise quickly whilst arranging a longer-term solution.
What can auction finance be used for?
Payment for property bought at auction must typically be settled within 28 days of the hammer striking. A mortgage is very hard to arrange in such a short timeframe and so bridging finance can be arranged far quicker.
A property bought at auction may also need work before a mortgage can be obtained on it, so a bridging loan can also be used to fund such work.
How much can my client borrow with auction finance?
At Mercantile Trust, customers can borrow between £25,000 and £500,000.
What are the benefits of auction finance?
- Access to short term finance quickly
- No minimum income requirement
- Rolled or serviced interest
- Property does not need to be habitable
What is an exit strategy?
Customers applying for auction finance must have a clear exit strategy; this is how they plan to repay the bridging loan at the end of the term.
The loan can be repaid in any number of ways, such as sale of a property, inheritance from a family member or refinancing a property. It is important that your customers consider their exit strategy at the outset so that the lender will feel confident in their ability to repay the loan at the end of the payment period.
Why use Mercantile Trust for auction finance?
At Mercantile Trust, unlike other lenders, we consider each and every application on its individual merit. No two cases are ever the same and our personal approach to lending allows us to create bespoke solutions for your clients.
View our full criteria here