DCI provides 100% bridge for below-market-value Luton purchase

District & County Investments (DCI) has completed a £370,000 bridging loan to help a repeat borrower buy a four-bedroom detached house in Luton below market value (BMV).

The borrower agreed to buy the property for £370,000 before it went to auction. DCI's loan covers the full purchase price.

How BMV lending works

DCI's BMV product lets the lender assess qualifying purchases against the property's market value rather than only the price being paid. Where a property is being bought at a big enough discount, DCI can consider lending up to 100% of the purchase price.

For investors, this can mean securing a discounted property without putting in a large cash deposit. For the lender, it means scrutinising how the discount came about and whether the underlying value genuinely supports the loan.

BMV transactions require us to understand how the purchase price has been arrived at.

Michael Clifford, Commercial Director at DCI, said each BMV deal has to be judged on its own facts rather than with a standard approach based only on the price paid.

Repeat business on both sides

The deal was introduced by broker Tushar Gadikar, who has worked with DCI before, and DCI has previously funded another purchase for the same borrower.

Clifford said it was important to DCI that both the borrower and broker came back, as familiarity on both sides makes the process smoother. Gadikar said he valued a lender that understands the difference between purchase price and market value, and that DCI's consistency in assessing cases gave him confidence to bring another deal.