Pre-funding / Trading Facility
Property investors and developers, who buy property, refurbish and sell it or hold it for long-term investment will find the Trading Facility a useful financial tool.
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The Trading Facility is a tailored facility set up using a client contribution of cash, property equity or a combination of the two.
The facility provides finance to purchase and carry out refurbishment work for residential property. Once renovated the property can either be sold or switched on to long term funding to hold for investment purposes.
The facility is normally set up for a 2-3 year period and provides the solution to running an effective refurbishment business.
With a facility of £1m it is possible to have a number of properties at different stages of refurbishment. If utilised correctly it can become a conveyor belt for properties being refurbished.
- Newly Purchased
- Initial Refurbishment
- End Refurbishment
- For Sale
- Sold (awaiting completion)
With an average house purchase price of £160,000 and refurbishment costs of £40,000 it is possible to have five properties in different stages of the refurbishment/sales process at the same time.
Using existing property equity it is possible to have the trading facility set up for 100 per cent purchase and 100 per cent refurbishment funding.
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