The client – an experienced property professional – required funding to both purchase the three-bedroom detached house and carry out the conversion.

The sale of the two apartments post-conversion would provide the exit.

Despite lacking experience of similar projects, the client had received positive feedback on the intended scheme from architects and the local authority.

UTB agreed to provide £318,000 for the purchase of the property and a further £135,000 to fund the conversion.

Fees and interest would be added on top.

The completed project would have a GDV of £900,000.

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The borrower requested to receive the funding for the works costs in three tranches of £45,000, following inspections by the bank’s asset manager.

The full facility totalled £512,000 with an LTV of 49% and GDV of 57%.

The deal has a loan term of 18 months, of which nine months will be used to obtain the necessary planning permission, with the remaining nine months used to market and sell the apartments.

The borrower also had a contingency plan in the event of the planning application being unsuccessful, whereby he would refurbish the property as a single dwelling at an estimated cost of £85,000 with a GDV of £740,000.

This alternative project would still be funded by UTB, with the sale of the property used to repay the loan.