If you opt to submit your case to us, we will endeavour to always offer you the best and most competitive products from our panel of selected Lenders.
We see ourselves as an extension of your business and hope you will too. We can act as the gateway to and find you competitive finance solutions, matching your needs. Although our area of expertise is specialist property lending, we have exposure to alternative finance products. The main types of situations we can assist with are detailed below.
LAND ONLY BRIDGING
Buying land for development is a common practice for property investors, yet if the land has no current planning permission it can be challenging to secure finance to fund the purchase.
Bridging loans to buy land provide a funding method for developers looking to buy sites with or without planning permission. The land can be used for any purpose, including building residential homes or commercial properties. Please note that Leveo are unable to offer loans against land for an individual’s personal place of residence.
Speed can be key. These types of loans can be used for buying building plots quickly, as it can take months for long term finance to be arranged. Building plots are usually sold quickly to developers, so interested parties need to act quickly. Leveo has exceptional relationships with their Lender panel, which means you can be approved with non-binding terms on the day of application, which means we can provide an ideal solution for quick land purchases.
Additionally, a bridging loan can be used for the initial land purchase and then refinanced with a development finance product. Keeping your finance with the same Lender can be beneficial.
WHAT IS A LAND BRIDGING LOAN?
A bridging loan for land is a type of loan used specifically to buy land which usually does not have any existing buildings established on it. This type of funding is a short-term option that helps bridge the gap while organising longer term finance.
The land may have previously been used for a number of different reasons, such as equine or agricultural purposes, storage or wasteland. In these circumstances, the developer will be applying for a change of use. It may have certain planning permission already which needs amending to suit the developer’s plans.
Some mainstream lenders may not lend on land unless it has planning permission, so bridging finance can be a natural fit. Redevelopment finance or a self-build mortgage is usually then applied for, which is used to pay off the original bridging loan and commence the building project. This finance can be secured against the value of the land being purchased.
Leveo will also review land that has existing vacant premises that are currently not income baring.
Bridging loans can also be used to buy the land, obtain planning permission and then sell it on to another developer.
WHY CHOOSE A LAND BRIDGING LOAN?
The land purchase market is very competitive and when property developers find suitable land they need to make a quick purchase before another developer buys it instead. Bridging loans for land purchases can often be approved on the day of application, providing developers with the comfort and security they can deliver on any offer they wish to make. This security often puts them in a more favourable position with the vendor/selling agent.
Land can be bought at auction which is a quick process that demands an immediate deposit and the balance due with within 28 days of purchase. Bridging loans allow developers access to funding quickly, thus helping to secure auction purchases. This timeline is often more challenging for mainstream funders to adhere to. With auction sales the assets often have complications or imperfections which can make bank based lending difficult to satisfy.
It is also possible to take out the bridging loan in increments as the development progresses, rather than borrow all the money in one stage. This can save the developer money on the overall interest paid, as it is only payable on the money borrowed.
During the loan approval process, Leveo will ensure there is a good exit strategy in place. This may be achieved through selling the properties built on the land, or through long-term refinancing options.
Loan terms are generally between 6-12 months and with Leveo as your broker, we will always look to negotiate the best entry and exit terms we can for you as our client.
Leveo always looks at each application holistically and on a case-by-case basis, even if the land does not have any existing planning permission.
Investors looking to purchase commercial property often have to act quickly. If finance is already tied up elsewhere within an existing portfolio, buyers may need the option to acquire appropriate funding quickly or risk losing out on a purchase. This is where commercial bridging loans can be a helpful solution.
Long term finance can take several months to secure. Many of the best opportunities present themselves with a change of use and/or add value potential. The most experienced and successful commercial property investors often recognise this and that’s where using Leveo and their deep understanding of the investment market can help to secure you finance.
Leveo can take into account the specific circumstances around the asset and borrower, allowing for more flexible lending. This is one of the reasons property investors may choose a bridging loan for funding commercial property transactions.
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