What Are The Benefits of Working With Commercial Acceptances?
- Work with decision makers
CA emphasise the role of speed in their business transactions with the ability to carry out checks and provide funds within 24 hours or in a matter of days. This can be ideal if you are looking to secure the purchase of a property before someone else does or if you have bought an estate through an auction.
By working with CA, you have the luxury of working with the main decision makers. Specifically, their senior personnel of Lawrence, Dan and Nic are available to speak to you directly to understand your needs and requirements. Considering the size and scale of their business, it is a rare opportunity to be able to speak to the head people so openly.
There is also a strong feeling of trust working with Commercial Acceptance. With the financial backing of a FTSE 250 company, you can be rest assured that they have sufficient funds and can assist with financial your project or venture.
What Are Commercial Acceptances Loans Used For?
CA highlight that their financial products are not for owner occupiers – referring to people that are living in their residence and looking to borrow against it. This suggests that their loans are less suitable for homeowners, but more property developers, businesses and investors. This is because Commercial Acceptances are not-regulated, so they are unable to lend to someone on their primary residence. However, it may give opportunities to those who are self-employed or new to the property development and looking for finance, that may be ineligible for regulated activity.
The CA website states that typical projects that they work on include auction finance. This is for when individuals or businesses are buying a property and have 28 days to come up with 90% of the funds. Since they will need money fairly quickly, they can apply with Commercial Acceptances as they are likely to access the cash quicker than if they applied for a regular mortgage.
Other projects that they refer to includes the mixed use refurbishment of a property in the centre of St Albans. An office space was turned in to 5 x 2 bedroom flats. The total loan facility was £1,380,000 based on 53% of the Gross Development Value of £2,615,000. They also talk about the case study of a derelict building in East London which was turned from being abandoned into a number of buy-to-let flats. The bridging facility was £200,000 and estimated at £600,000 to £700,000 upon completion months later.
What Are The Rates Charged?
The monthly interest rate charged starts at 0.75% per month, however, this rate is subject to change based on your credit rating, the amount of risk at stake and also in line with the 3m LIBOR(The London Inter Bank Offered Rate For Three Month Sterling Deposit). The overall cost for comparison is 10.6% APR.
Whilst CA state that they do not charge any administration or arrangement fees, there are still some additional fees to be aware of:
Mortgage valuation (starting at £275 +VAT) – this is required during the application stage to assess the value of the property that you are using as security. The cost of this is based on the standard £1 per every £1,000 of the value of the property, although the cost for more expensive properties may be less.
Legal fees (£850 + VAT) – the customer will be responsible for any legal fees incurred by Commercial Acceptances in order to process your loan application.
Finance set up fee (£250 + VAT) – this is only for CA Trade customers i.e those looking to borrow larger sums for longer than 12 months. This does not apply for anyone applying for bridging finance.
Release of deeds (£200 + VAT) – on repayment of your loan, CA’s solicitor will charge an administration fee for the release of the deeds for the property.
Information and statement fees (£20) – monthly statements are facilitated each month but if you request one after the loan term, there is a small fee for this.
Insurance (Upon request) – it is essential that you have buildings insurance in place for any potential mishaps to your property including fire, flood or theft. This will allow you to cover the damages and also be able to maintain any necessary loan repayments.
Arrears fees (£250) – if you fall behind on your loan repayments and litigation is required, CA will charge you a minimum fee of £250 for any costs incurred.
Bank charges (£5) – for any failed repayments that do not go through by cheque or credit card, the costs will be passed onto you.
The costs mentioned about can all be included in the overall cost of the loan and paid at the end of the loan term. This can be useful to those developers who are looking to manage their funds and keep as much as possible to put towards their project.
For customers that find themselves in a good financial position, there are no charges for early repayment, unless you pay significantly earlier than expected (e.g within the first month)
Once you have submitted your interest in working with Commercial Acceptances, you will be able to receive a decision in principle over the phone and in writing. Once confirmed, you will need to provide copies of your passport, bank statement and a utility bill which is valid within the last 3 months and pay the valuation fee for the property.
Address: 100 George Street, London, W1U 8NU
Countries they operate: England, Scotland and Wales.
Member of: NACFB, ASTL
Company no: 01715185
FCA authorisation number: 303384