Precise Mortgage has completed on a bridging loan for £5.9 million and subsequently claims that it has saved £84,965 in interest payments and a further £17,992 on the facility fee when directly compared to another “well known” lender.
The specialist intermediary lender attributed this claim to what it calls its own “unique interest and fee charging method”.
As a number of lenders publish their Retained Interest Calculators, Precise Mortgages used a well known lender’s calculator to create a direct comparison. It has not disclosed which lender it has based the calculation on.
For a loan of £5 million (net of retained interest) on a £12 million property over an 18-month term at a rate of 0.85% per month, Precise Mortgages’ APR was 12.1% with a 1.75% facility fee, £35 TT fee and a £295 assessment fee.
Precise Mortgages’ APR also included a valuation fee of £5000, legal fees of £2000 and a redemption administration fee of £120.
Alan Cleary, managing director of Precise Mortgages, said: “It shouldn’t be the case that lenders can quote the same interest rate but be so much more expensive.
“All lenders should voluntarily quote APRs so that brokers and borrowers can contrast and compare bridging loans.”
Rob Ground, the broker who arranged the bridging loan with Precise Mortgages through the Adrian Knott Partnership, said: “I was very pleased to be able to save my client so much with Precise Mortgages.
“Not only is their interest charge more competitive but they charged the facility fee on the net loan drawn not the gross loan. I agree with Alan, all bridging lenders should quote APRs otherwise it is all but impossible to compare deals.”