We’ve helped a father-son dairy farm to complete the sale of land for housing.
The farm’s owners first approached their bank for a £100k loan 18 months ago.
However, when Covid-19 hit, councils across the country were severely delayed in processing planning applications.
In response to this, the government extended the expiry date for all planning permissions.
Unfortunately the bank wasn’t able to provide the same extension, and after a year had passed it got lender fatigue.
The bank insisted that the farmer either repay the loan or find another lender. If he didn’t, they would be forced to repossess the property that it was secured against.
It would be another four months before the council granted planning permission, so the farmer needed to find another lender that could take on the loan.
He also wanted to borrow additional short-term capital to invest in his business.
Reparo Provides a Solution and Support
We were initially approached by a broker acting on behalf of the bank.
We lent the farmer £160k on an interest-only basis over 12 months.
This capital would allow the farmer to pay off the bank, invest in his business, get planning permission and then sell the land.
This deal presented a couple of challenges.
First, the farmer had previously engaged a developer. The agreement between them had expired, however the developer still held a charge on one of the site’s buildings.
We asked the developer to remove the charge from the Land Registry.
A bigger issue was that even though we had agreed to fund the sale of the land, we couldn’t release the money until planning permission was granted.
During this time the bank’s lending covenants were exceeded and it wanted to take possession of the farmer’s property.
We stopped the repossession by negotiating extensions to the pre-existing loan with the client’s bank while planning permission went through.
Flexible, Patient Lending
Alternative lenders like Reparo are perfectly positioned to help businesses that are under pressure from mainstream lenders.
Banks are limited by covenants that govern their lending practice—including how long they can wait before receiving payment.
Reparo, on the other hand, is flexible and patient. Our team can also support clients by pushing the lending process forward and negotiating on their behalf.
Thanks to Reparo, the farmer has been granted planning permission and is now selling the land.
If your business needs a fast, accessible loan between £25,000 and £1 million, get in touch with one of our team today.
Daniel Jones
07824 873 358
dj@reparofinance.co.uk
Gurinder Mandir
07805 737 324
gm@reparofinance.co.uk
Craig Ashton
07917 907 931
ca@reparofinance.co.uk
Photo by Jakob Cotton on Unsplash