CVA Complexity Overcome with Strong Semi-Commercial Security
The Client Background
A broker approached us on behalf of an established electrical and building contractor with a 24-year trading history.
The business had recently entered into a Company Voluntary Arrangement (CVA), with outstanding unpaid debtors creating added complexity around the case. The client required funding to refinance existing borrowing, while also releasing equity from a recently refurbished semi-commercial freehold property.
In addition, the upper floors had been converted into a 4-bedroom HMO, creating an additional rental income stream and adding further value to the property.
The “Positive” Solution
Despite the recent financial challenges, we were able to present the case as a well-structured proposition, supported by multiple layers of security.
The security package included:
The Loan
Product: Commercial Mortgage
Client: Owner occupier
Lender: Together
Loan Amount: £123,000
Monthly Payments: £1,064
Rate: 8.99%
LTV: 65%
Broker Commission: £768
Process: Positive Lending advised
✓ First legal charge over the semi-commercial property
✓ Debenture over the trading business
✓ Unlimited personal guarantee from the director/shareholder
By clearly setting out the client’s trading history, the mixed-use nature of the property, the additional rental income, and the strength of the security available, we were able to give the lender confidence in the overall proposition.
The case demonstrated that, while the CVA added complexity, the wider structure and security package provided a strong basis for funding.
Why Choose Positive?
When a case has added complexity, clear presentation is everything. Positive works with brokers to structure the proposition, highlight the strengths, and find lenders with the appetite to look beyond the obvious challenges.