Background
Our clients are experienced property developers and investors who had recently completed a residential development and were approaching the maturity of their short-term finance facility. With market conditions remaining soft, they were looking for a long-term refinance solution that would allow them to retain completed stock and support their broader investment plans.
Challenges
Their existing lender declined the refinance application due to the significant funding required and the concentration of all six securities being within a single development.
- Funding required: $3.75 million
- Concentration risk: 6/6 lots in one development
Mitigants
Working closely with the clients’ adviser, we thoroughly assessed the clients’ overall financial position and credit history and identified several mitigants:
- Strong credit profiles
- Stable employment history
- Strong borrower profile with significant asset base
- Well demonstrated affordability
- Registered valuations confirming quality constructions
- Desirable location within a main centre
- Good LVR position
Solution
While the concentration of all six securities within a single development was a challenge for the clients’ existing lender, we were comfortable proceeding given the nature, type and location of the securities.
Combined with the clients’ strong credit profiles, a reduced LVR and multiple securities, this enabled us to provide a well-structured long-term refinance solution that replaced the maturing short-term funding and unlocked equity for the clients’ next development project.
LOAN AMOUNT
$3,750,000
TERM
30-year Principle & Interest,
with 5-year Interest Only
LVR
69%
COMMISSION
0.80% with a 24-month clawback period
ADVISER FEE
$18,750
AVANTI FEE
$37,500
CASE STUDIES - PROPERTY LENDING
“Our Property Investment Loan is designed for customers investing in residential properties. We provide tailored lending solutions to support your clients’ portfolio growth, whether they’re refinancing completed stock, consolidating existing lending, or releasing equity for the next project.
If you have clients requiring funding to invest in property, get in touch with your local Avanti BDM.“
Harriet Wright
Business Development Manager, Auckland South and Waikato
