Affirmative

Overview

Affirmative has embedded fair treatment of customers within the business. They look at each case on its own merits and work to tight timescales for loan completion. Affirmative can provide secured, bridging, short-term and development finance within the following parameters:

• £10,000 minimum, up to a maximum of £5 million
• 75% LTV or higher in some cases
• Flexible rates from 1% per month
• Staged facilities with interest only charged on the monies drawn
• 100% of purchase price, build and refurbishment or development costs
• Affirmative will lend by way of 1st or 2nd charge on residential, semi-commercial and commercial properties (including land).

Affirmative offer a versatile product range which can be utilised for the following purposes / properties:

• Auction purchases with pre-auction bidding facilities agreed
• Buying before selling
• Regulated self-build projects
• Development projects (multiple units)
• Refurbishment projects
• Renovation projects
• Mortgage retentions i.e. no kitchen or no bathroom
• Non-standard construction
• Barn conversions
• Lease extensions
• Tax bills
• Quick completions: benefit from discounted price

Constructive Lending

Constructive Lending is a brand of Affirmative Finance, one of the leading short-term finance houses in the UK for the last decade. The provision of self build finance has become a core element to their business and they have become the first port of call for many intermediaries seeking such finance.

Deferred Consideration

Deferred Consideration is an option that Affirmative offers which gives a developer the option of not having to pay for land/an existing building upfront, so potentially a development can be started without a deposit. It all comes down to the seller’s willingness!

The buyer/developer can approach the seller and ask if they would defer their payment: (Obviously not everyone will be willing to do this) This could be either deferring all the payment until the site is finished or deferring some funds at the start with further payments to be made throughout the development. Affirmative can be flexible with this and structure it to suit both parties.

Once the seller agrees, Affirmative will sit first charge on the site and the current owner (seller) will sit second charge to offer them protection. We then use the value of the site as security to lend the funds to the developer. Once the development is complete, it is sold or refinanced to pay back our loan and to pay for the land.

A recent example we had:

Loan application received for £1.5m

£900k was to purchase the site which had planning for 18 houses (To be built in 3 lots of 6)

£600k was to build the first 6 houses (£100k build cost each with expected sale price of £250k each) The profit would be used to build the remaining houses

We asked the developer who was he buying the land from. It was a someone he had bought 4 other sites from so he had got to know him fairly well. We suggested Deferred Consideration and he thought the seller might accept.

Verbally they agreed that instead of taking £900k up front, he would accept £930k in 18 month’s time. (Our solicitors will sort all the legals for this)

We now have a £900k asset to use as security to lend the developer the funds.

Great deal for everyone. The land owner gets an extra £30k (He has to wait 18 months but he has owned the field for years so he was happy to wait) The developer is only borrowing £600k instead of £1.5m so is paying much less interest. The developer then has the funds from the sale of the properties to pay for the land.