How Can Luxury Asset Lending Complement Short Term Property Finance?

Short term loans are designed to be temporary facilities to allow a purchase transaction, meet an immediate financial deadline or make a project happen and repaid when longer term funding is secured, or funding is no longer needed.

1. Flexibility to fill a funding shortfall

Conventional bridging/short term loans secured by property are subject to a greater degree of scrutiny in respect of affordability and the credit status of applicants. A luxury asset loan, however, has no such restriction, as the only criteria are to validate the value and provenance of the luxury asset. So, the minimum of paperwork to achieve the fastest result.

Standard borrowing in luxury asset backed lending from Suros Capital starts from £20,000 and goes up to £2 million. This is common to both types of loan although conventional lenders tend towards larger minimum loan amounts.

Many enquiries we get from intermediaries – the client already has outstanding property finance and simply uses us to top up or fill a smaller funding gap.

2. Solving an immediate funding need

At Suros Capital, we can turn around an enquiry in hours. The only limitation is having access to the asset. There is still a general perception that bridging finance backed by property can produce funding in the same timeframe. It can sometimes. However, those cases are very rare, because of the amount of paperwork and checks to be made.

3. Spreading the risk across alternative asset classes

Many of our clients have property portfolios as well as luxury asset collections such as high value jewellery and classic cars. Property and luxury asset valuations can behave very differently, and in scenarios where the client has outstanding finance against property, leveraging an asset other than property, the risk can be spread across different asset classes.

Summary

Making use of a luxury asset’s intrinsic value to act as security for a short term loan is a clever way to raise funds quickly, without diverting other funds, which are better deployed elsewhere.

• No income or credit checks
• No charge for valuation and assessment of the asset(s)
• No legal costs
• Funding can be within hours
• Asset securely stored

Case Study: Jewellery helps complete Buy-to-Let (BTL) purchase

A client, buying a BTL property, had her original loan with a lender reduced and had a shortfall of £58,000, which was required to complete an imminent completion. With no time to arrange supplementary financing, she was introduced to Suros Capital and having presented jewellery, including a diamond ring and bracelet at their London office, we were able to release the amount required to complete the deal on the same day.

Case Study: Property developer uses Porsche to fund auction acquisition development

A developer who bought a property at auction had used the funds originally set aside on another property development. Being unable to source the funds he needed to fund the work on the new property so the development could be completed on time, his mortgage broker suggested approaching Suros Capital. Having assessed and valued the car, we were able to release £66,000 (60% LTV) to the client. From first enquiry to funds drawdown took just 72 hours.

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