Can you get bridging finance on a house you want to live in?
I’ve found a 7-bed detached house that looks like it’s been converted into three flats - I suspect without planning permission as it’s advertised as ‘Cash buyers only’,
I have some development experience and could afford it on my income with a mortgage when appropriate. I have access to a fifth of the purchase price in cash today and own a rented property outright which I intend to use as equity for future developments.
Yes, you can get bridging for a house you want to live in, it is FCA regulated bridging, which means the lender has to have been approved by the FCA to lend on a main residence. This rules out all but a handful of bridgers, because the rest have decided it’s too costly and too involved for what is a tiny percentage of the bridging market.
An FCA bridger is duty-bound to take greater care with your application and they will need to ensure you have the ability to get a mortgage sufficient to repay them before they will agree to lend.
Buying the property you describe presents additional obstacles you will need to overcome:
If you can buy this property at a price that allows you to create a good uplift in value (you should do, as the seller will know that a conversion without planning permission is going to go at below full market value and will take offers), it will make it easier to mortgage at the back end.
A bridger will let you put up your unencumbered property instead of needing to put down a cash deposit. You can then keep the cash you have to fund the works required to the property.