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Property investors can be faced with complex legal issues when they set out to refinance development loans relating to multiple properties.
When a client belonging to award-winning brokers B2B Finance wanted to refinance a development loan they had used to upgrade a block of flats worth more than £1.2m, the brokerage firm turned to Redwood Bank and its solicitors, Knights, to handle the complex deal.
An experienced property development investment firm wanted to refinance a development loan they had used to upgrade a block of flats in Wrexham.
The firm, which has more than 20 years’ experience, has a large property portfolio and had owned the refinanced properties since 2021. The block contained 24 flats and, having sold half of them, the firm approached Redwood Bank, via broker B2B Finance, to refinance the remaining 11 apartments, worth £1.22m, and move to more cost-effective borrowing with the Bank.
The properties were held on two separate leasehold titles however the leases were defective and needed to be corrected. The client also owned the freehold to the properties.
The legal issues regarding the title and the defective leases required Redwood to do a significant amount of work with its solicitors, Knights, to reach a resolution for the client and fund the deal.
Knights acted as a dual rep solicitor – representing both Redwood as the lender and the property development investment firm as the borrower – to streamline the process.
Carla Santos from Redwood’s Credit Operations team worked through the complicated title and lease issues with Knights to bring the deal to a successful conclusion.
The Bank approved a £934,065 loan at a 76.5 per cent LTV ratio on a 20-year interest-only term. As the majority of the properties had an EPC (Energy Performance Certificate) rating of C, the deal also qualified for a Green Cashback Reward.
Redwood Head of Business Development (Midlands and Wales), Andre Parcian, said: “B2B Finance is an award-winning national commercial finance brokerage and we have an excellent relationship with them. Their team turned to us for support because they know we have vast experience of supporting property investors and that our dedicated Credit Operations team had the expertise to handle this complex deal and deliver a positive result for their client.
“They were confident that we had the tenacity to address the legal issues surrounding the deal and that we would ensure they would not be a barrier that would prevent it from being completed.
“We were delighted to work on this deal with Knights because we’re always keen to support experienced property investors and be a part of their growth.”
Rebecca Jones, B2B Finance, added: “Redwood Bank is one of our most trusted lending partners, with a clear understanding of the needs of experienced property investors. Their specialist approach and ability to handle complex cases really set them apart.
“In this deal, Carla Santos in their Credit Operations Team worked closely with all parties to resolve intricate title and lease issues, and we truly valued the proactive and collaborative support throughout the process.”
Chloe Arnold, of Knights, said: “We were pleased to help the client overcome the legal issues regarding the title and correct the defective leases relating to the properties. We provided a positive resolution for the client that enabled the deal to proceed. By working closely with Redwood, we offered the client a streamlined approach which made the whole process much more straightforward for them.”