Here are some of the most common questions we hear about our loans and the world of property finance.
All of the charges you’ll encounter during your bridging loan are listed here. Commercial Acceptances don’t charge you anything else: there are no set-up fees, no end fees, no extension fees and no arrangement fees.
A bridging loan is either ‘regulated’ or ‘non-regulated’. A regulated bridging loan is one that relates to borrowing against a property which you, or a family member, intend to use at least 40% of as a dwelling. These loans are regulated by the FCA. Commercial Acceptances do not provide regulated facilities.
To arrange a fast bridging loan, we will need the following information from you:
We’ll process your application for a bridging loan quickly, and give you a decision in principle over the phone and in writing. Once we’ve agreed to process your application, we’ll need certified copies of your passport, bank statement and a utility bill (both of which must be no more than 3 months old) plus the valuation fee. For details of the valuation fee please see our Tariff of Charges.
We can lend from £50,000 to £5 million, depending on the value of the property offered as security.
We lend up to 70% of the 90 day market value of the property.
Fast. We’ve been known to complete loans, from first enquiry, within 24 hours.
A monthly rate from 0.75% will be chargeable on the amount borrowed. However, rates are subject to change and will increase or decrease in line with movements in 3m LIBOR(The London Inter Bank Offered Rate For Three Month Sterling Deposit). Rates will be adjusted on each monthly anniversary of the facility. The overall cost for comparison is 10.6% APR.
There are no charges for early repayment.
The bridging loan is usually secured by way of a first charge over the property. If the borrower is a company, we will need a debenture and personal guarantees.
Commercial Acceptances is a principal finance lender – it’s our money to lend on a commercial basis. This means we have immediate access to our money, which doesn’t slow up the process.
We don’t charge you any other fees at all. But, there are other costs you’ll need to pay – to our solicitor, for example. We’ve detailed all of these additional costs in our Tariff of Charges.
No, we are not authorised and regulated by the FCA (Financial Conduct Authority). Please be aware that non-regulated bridging loans are not regulated by the Financial Conduct Authority; since Commercial Acceptances does not offer regulated bridging loans, we do not require authorisation or regulation by the FCA.
We do offer longer-term bridging loans for the right projects and candidates. You can read more about them here, and if you give us a call we can see whether CA Trade might be the right product for your needs.
Lenders regularly sell repossessed properties at auction along with developers, investors and owner-occupiers looking for a quick sale. Sellers are attracted to property auctions as they offer a sale on a specific date. Plus, the buyer or vendor can’t change their mind once the hammer falls – the sale is contractually binding.
Most property auction houses don’t advertise publicly as they are aimed primarily at professional buyers. Have a look online or ask your local estate agent about property auctions near you. Many of the larger London-based property auctioneers offer properties throughout the country, while regional property auctioneers generally offer properties locally. Often, rural or unusual properties are sold at a one-off or specialist auction through a local estate agent.
Property auctions usually take place three or four weeks after the property auction catalogue is issued. If you’re successful at the property auction, you usually have 28 days to complete the purchase, although this can sometimes be as little as 14 days. See the special conditions of sale section below. You can also see a list of all upcoming property auctions here.
What type of property are you looking for – and how much do you want to spend? Is it for you to live in? Is it an investment property? Or one you want to develop? Then you need to identify suitable property auctioneers and property auction houses. Once you’ve found the right auctioneer selling the type of property you’re after, register and they’ll send you a catalogue of future property auctions.
Firstly, mark the Lots that interest you and make sure you understand how the property is being offered. For example, some Lots are offered with vacant possession, while others may have sitting tenants (people who already rent the property and who have certain legal rights), making them unsuitable if you’re buying a property you want to live in.
You must be aware that Commercial Acceptances does not provide regulated mortgage contracts, where it is either your or an immediate family member’s intention to occupy at least 40% of this property as a dwelling, either now or at any time in the future.
Further, it should be noted that many people have bought property at auction, not realising it was occupied by a sitting tenant with the right to occupy until they die.
Secondly, having marked off the properties that interest you, call the auctioneers during office hours to register your interest. This way, the auctioneer can contact you if the property’s withdrawn, or it’s sold before the auction. They’ll also let you know of any major changes to your Lot.
Guide prices are quoted in the auction catalogue. As the name implies, these are for guidance only and give you an idea of the price the seller is looking for.
The seller sets a reserve price with the auctioneer immediately before the property auction. Buyers are not told what this is, and the property won’t be sold if bids don’t reach it. However, if your bid is close to the reserve price, the auctioneer will make this clear and suggest you ‘come and speak to us’. As long as bidding exceeds the reserve price, the Lot will be sold.
It’s essential you view properties that interest you before the auction. You’ll find viewing arrangements for each Lot in the property auction catalogue. If you have any questions, call the auctioneers. It’s normal for auctioneers to arrange group viewings on popular Lots, so there may be many people at the viewing.
The seller’s solicitors will provide copies of all the legal papers you and your solicitors will need to make an informed decision about a Lot. It will include, where appropriate, copies of Title Deeds, Leases, office copy entries, planning permissions and answers to standard enquiries. These legal packs are available from the auctioneer or the seller’s solicitor and usually at the property auction itself. Auctioneers will often charge around £10 to £20 for a legal pack.
Each Lot is sold subject to the Notices and General Conditions of Sale printed in the property auction catalogue. The seller’s solicitor will also draft additional terms that apply to an individual Lot, known as Special Conditions. These aren’t always printed in the auction catalogue, but are available on request from the auctioneer or the seller’s solicitor. They’re part of the Contract of Sale and it’s very important you and your legal advisors know about all conditions before you bid at auction.
It’s always wise to get a surveyor’s report and, where appropriate, a full structural survey. This can be expensive if you’re interested in more than one Lot, or if you’re outbid at auction. However, a survey will spot problems you weren’t aware of, plus you’ll have a better idea of a property’s value. Your surveyor may need to attend a group viewing. With tenanted properties, access isn’t always readily available, even after the auction. You’ll need to bear this in mind, as most long-term lenders require an internal inspection of the property.
You can make an offer for a property before the auction by contacting the auctioneer. It’s likely the seller will still go ahead with the auction, but there’s a chance you can agree a deal if your offer matches or beats the price the seller thinks they’ll get. If you agree to buy the property before auction, you’ll need to sign the Auction Contract before the auction starts. Your contractual obligations are the same as if you had successfully bid for the property at auction.
If you can’t make the auction, you have three options:
Bidding at auction is fairly straightforward if you’ve done your research and made all your enquiries before the auction begins. Set a maximum bid and stick to it – no matter what. If you have any doubts during the auction, or still have some unanswered questions, don’t bid.
Make sure you’re there at the start, so you can listen to the auctioneer’s opening remarks and follow the bidding in the early Lots. When the auctioneer announces your Lot, they’ll also tell you about any last-minute items you should know about. They’ll usually read the full address of the property, so double-check this is the Lot you’re interested in. You bid by raising your hand or catalogue.
Make it clear you’re bidding, as it’s often quite difficult for the auctioneer to see who’s interested in a Lot if the room is busy. If you want to make a bid other than what the auctioneer calls, shout out your bid – the auctioneer will decide whether to accept it or not.
The property is sold to the highest bidder, as long as it achieves the reserve price. The auctioneer will warn they are about to sell the property by saying something like “Going once…” or “Going for the first time…” before the hammer goes down.
If you bid successfully, you’ve entered a contract with the seller. You’ll be given a bidding slip and asked to supply the name of the buyer and solicitor involved. You’ll then have to pay a deposit of 10% of the sale price, or the auctioneer’s minimum deposit, before the auctioneer’s clerk can prepare the contract.
You must sign the contract before leaving the auction room, and give a copy to your solicitor. The auctioneer will ensure the seller’s solicitor receives a copy of the contract. Completion usually takes 28 days, though sometimes special conditions require a faster completion.
When the hammer falls, a property auction deposit (10% of the sale price) is payable. If you’ve bought a fairly low-value property, the auctioneer may require a minimum deposit – often as much as £2,000. You can pay with a banker’s draft or building society cheque. It’s unlikely the auctioneer will accept personal or company cheques unless you make arrangements at least 3 working days before the auction. Property auctioneers don’t accept cash.
If you’re not sure how much to get a draft for, go for 10% of your maximum bid price – bearing in mind the auctioneer’s minimum deposit – and take it to the auction. If you buy for less than your maximum, the difference is taken from your balance.
As soon as you’ve exchanged contracts, you’re responsible for insuring the building, so make sure you arrange insurances immediately after the sale.
If a Lot doesn’t reach its reserve price and you’re still interested in it, make sure you register your highest bid with the auctioneer before leaving the room. Or call the auctioneer after the auction to register your continued interest. The auctioneer will contact the seller and let you know if a deal is possible.