In parallel with the Due Diligence process, Bridging Vat will instruct solicitors to issue standard loan documents to the borrower's solicitor.
Our standard loan documentation includes:
a Facility Agreement.
a Debenture incorporating a registered charge over the property being acquired.
a Personal Guarantee from each director or shareholder of the special purpose vehicle acquiring the property. (Each guarantor is required to provide signed confirmation from a solicitor showing they have taken independent legal advice before entering into the Personal Guarantee.)
Bridging Vat usually hold a registered second charge, as a junior lender ranking behind a senior first charge lender. In these cases an Intercreditor Deed is required to govern our relationship with the senior lender and permit the release of the VAT recovery received from HMRC to repay our loan. The agreement of the Intercreditor Deed is handled by our and the senior lender's solicitors.