Property auctions is that the winning bidder has to complete the purchase within 28 days. If the buyer cannot raise the money by the completion deadline, they will have to pay steep penalties or face legal action.
A broker will be able to find a commercial mortgage for buy-to-let homes and commercial properties, but it may take over 28 days for the funds to be available. If this is the case, a broker can arrange bridging finance, which can be made available quickly, and the loan can be repaid after the long-term mortgage funds are secured.
Many investors purchase property in a bad condition but at a low price. After construction work, the property will increase in value and can be sold at a profit. Investors adopting this strategy are looking at a quick turnaround from purchase to selling. They use bridging finance to finance the deals, then repay the loan from the proceeds of the property sale.
Another popular strategy is to purchase old, large houses then convert them into houses of multiple occupancy (HMO). HMOs can generate larger rents from multiple tenants compared to single household tenants. They are licenced by local councils that impose conditions including minimum room sizes, and safety measures.
A good mortgage broker, as well as arranging loan deals, is able to advise on what is involved in the various types of property investments.