Raising Bridging Finance to Refinance Existing Borrowing and Fund Business Expansion

Client Background

Our clients were experienced business owners and company directors with a strong income profile and substantial personal and business assets.

Their wider financial position included business interests valued at approximately £1.5 million alongside total assets approaching £4 million. The clients were actively focused on expanding their commercial operations following the recent acquisition of a restaurant chain.

The Scenario

The clients required additional funding to support the continued growth and expansion of their newly acquired restaurant business.

Their objectives were:

• Raise approximately £450,000
• Repay an existing first charge mortgage of around £250,000
• Inject approximately £200,000 into the business
• Use a flexible short-term funding solution
• Exit the facility through the future sale of property

The clients required a structured bridging solution that would refinance the existing borrowing while simultaneously releasing capital for business investment.

The Challenge

This case involved several complexities that required careful lender selection and strategic structuring.

The existing first charge mortgage had to be repaid in full, meaning a second charge structure was not an option. In addition, the funding was required partly for business purposes, while the transaction itself was highly time-sensitive.

The clients also had a complex income structure involving salary, dividends, and business income streams, requiring a lender comfortable with more detailed financial assessment.

The proposed exit strategy relied on the future sale of property, meaning the facility needed to provide sufficient flexibility throughout the term.

The Solution

We arranged a tailored regulated bridging loan designed specifically to refinance the existing mortgage and release additional capital for business expansion.

The funding solution included:

• A net loan amount of approximately £450,000
• Repayment of the existing mortgage balance of approximately £250,000
• A 12-month term
• First charge security against the property
• A loan-to-value of approximately 74.43%
• Rolled-up interest with no monthly repayments required
• A fixed interest rate to provide cost certainty

The structure enabled the clients to refinance their existing borrowing while unlocking additional capital to support the continued growth of their restaurant business.

Implementation Process

We carried out a detailed assessment of the clients’ financial position, income structure, and wider business objectives before structuring the bridging facility.

A suitable lender was sourced that could accommodate the refinance requirement alongside the business-purpose capital raise within a single first charge structure. Careful consideration was also given to the proposed property-sale exit strategy to ensure sufficient flexibility throughout the loan term.

Given the time-sensitive nature of the transaction, communication between all parties was managed proactively to ensure the funding progressed smoothly and completed within the required timeframe.

This hands-on approach enabled the clients to secure the required capital quickly while maintaining control over their wider financial strategy.

The Outcome

The bridging loan completed successfully, enabling the clients to refinance the existing mortgage and release substantial capital for business expansion.

As a result, the clients were able to:

• Repay the existing first charge mortgage successfully
• Inject additional capital into their restaurant business
• Support the continued growth of the restaurant chain
• Maintain flexibility through a short-term funding structure
• Move forward with a clear and manageable exit strategy