The business world is unpredictable. Certain industries are dependent on regional influxes, or forecastable trends. Where unexpected disturbances arise, business owners can struggle. A borrower may turn to us for support with their company as, unfortunately, it could’ve fallen on hard times.
To keep the firm afloat, they’d likely need to raise capital to support their business’s cashflow. An unexpected, yet temporary revenue loss can unfairly derail otherwise promising long-term potential.
Sometimes, to push through these kinds of tough periods, borrowers often hope to raise capital against once of their commercial properties. We can assist with this. But, with a lack of revenue on the immediate horizon, we’d need to work hard to ensure our funding can be covered down the line.
Unfortunate Timing
To start with, our underwriter would need to work closely with the borrower involved to determine if the cashflow challenge was truly an isolated incident. We’d comb over the relevant paperwork and documentation to determine if the issue was likely to repeat or not. Looking ahead, we’d aim to establish when normality should have returned to the business.
If we generated a rough timeframe for this, we could then turn our attention to the exit strategy. Often, with these kinds of cases, the borrower will aim to sell one of their commercial units to cover our funding.
If this was the case here, we’d look to see if they had any interest from potential buyers. To ascertain how quickly the asset was likely to sell, we’d review its credentials.
We’d explore if it was in a prime location, how easily it could be converted into a residential home, if its underlying industry was in demand etc. So long as there was potential for a sale (and preferably, clear interest), we would likely be able to help deliver cashflow.
Specifically, our Bridge Fusion product could be of particular use here as the two-year term, along with the potential 12-month extension, could allow the borrower to get back on track, sort their accounts, and focus on their exit strategy.
Be Ready for Anything
Businesses across various sectors have faced multiple unexpected (or unwelcome) upheavals in recent years. There was the Brexit fallout, a global pandemic, the mini-budget, Labour returning to power, and more.
While these kinds of events may catch some off-guard, we know that they’re really just par for the course in the economy and property market. We have been lending since 2006 and in that time, we’ve learned to support property investors through countless economic and political headaches.
As further uncertainty looms, we will continue to be there for businesses, individual borrowers, and portfolio landlords.
