Releasing equity from international real estate.
If you are in the UK, releasing equity from UK real estate is relatively easy – there are a huge number of options and lenders. However, if you are not in the UK, or your property is in a country other than where you live, it’s not so easy. We can release equity from valuable real estate no matter where you are or where the property is.
Unencumbered property in London valued at £4m, held in a trust or an offshore company on behalf of a non-resident person – perhaps based in the Middle East. The property is not let, it is not used by the UBO, it is not income-producing. It’s an asset which was bought years ago and has increased in value.
Tenn can release up to 65% of the property’s value for the UBO to use for other purposes.
Or perhaps the property is in Europe and the borrower is in the UK, or any other or the thousands of combinations!
Financing overseas real estate acquisitions
In the same way, financing property acquisitions in countries other than where you are resident can be a challenge – speed, regulation, income and asset requirements, AUM requests and the process, in general, can cause huge problems. We offer short-term loans, 0-3 years to facilitate the acquisition of international real estate.
An example may be buying a holiday home in Southern Europe, or a property to move into in due course as part of their tax planning. Let’s say the purchaser is a UK national, wealthy as a result of selling his business, hasn’t yet received all the funds and is low on income. We could offer a loan (dependent on how the acquisition is structured) which would allow the purchase to be completed and then either repaid with a local mortgage or the sale proceeds of the company sale. We allow this to happen quickly and easily.
Releasing equity from property while it’s being sold
Another common reason for individuals using Tenn is to allow them to release equity from property in the period leading up to a sale. The time required to achieve the right price and the length of the sales process. These are compounded at the moment by mortgage, surveyor and other delays and the state of the market as a whole. We are very happy to offer loans secured against real estate, replacing the current debt and releasing equity at the same time, during the sales process. These funds can be used for any purpose, business investment, other acquisitions and so on.
This is pretty common at the moment. An example would be a large buy to let, say it’s on the market for £5m and has a mortgage on it of £1m. We could offer a loan up to 65/70% loan to value which would repay the £1m and release a further £2.5m to the owner to make investments with while it sells. The loan and interest would be repaid once the property sells. Sometimes, especially now, having more time or less pressure to sell can help achieve a sales price which covers the interest cost – and that’s before you add in the opportunity cost of the other investments.