Kohn Capital
Property Rookie0 / 100 pts
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Try your own deal

Same property. Two very different numbers.

Pick a scenario or change any number. Price, finished value and rent are our example. Works, timing, rates and costs are illustrative—not a Kohn Capital quote.

£
£
£
£

Route A

Lower borrowing

75% of price + works · 0.75% a month (illustrative)

Properties affordable
1
Cash required
£167,766£167,766 each · £32,234 unused
Total bridging costs
£33,516Interest + fees
Refinance: cash released
+£111,250A new loan, not profit
Result after included costs
+£28,191Over 60 months, before tax
Better result

Route B

Kohn Capital: up to 90% of finished value

Up to 90% of finished value · 0.9% a month (illustrative)

Properties affordable
2
Cash required
£154,090£77,045 each · £45,910 unused
Total bridging costs
£78,090Interest + fees
Refinance: cash released
+£30,000A new loan, not profit
Result after included costs
+£45,322Over 60 months, before tax

You paid £44,574 more for bridging. You could fund 2 properties rather than 1. Over this example’s 5-year comparison period, the result after the included costs is £17,132 higher.

Same pot, property, works, rent and timeline on both routes. Rates and assumptions are illustrative—not a Kohn Capital quote. Before tax. Excludes tax, rent or value growth, sale costs and the cost of tying up cash. Unused cash earns nothing here. Terms and conditions apply.

Per project. Totals multiply by properties affordable.

ItemRoute ARoute B
Price + works to fund£445,000£445,000
Most the lender will lendRoute B: up to 90% of finished value£348,750£558,000
Bridging loan usedNever more than price + works£348,750£445,000
Deducted at completion£0£0
Your cash towards price & works£96,250£0
Purchase taxes & legal£32,000£32,000
ContingencyFrom your cash, assumed spent£6,000£6,000
Interest reserveLoan × monthly rate × 9 months£23,541£36,045
Arrangement feeKohn Capital charges none£6,975£0
Other bridging feesValuation & legal (illustrative)£3,000£3,000
= Upfront cash per project£167,766£77,045
New long-term loanIllustrative, from another lender£465,000£465,000
Repays the bridge−£348,750−£445,000
Refinance fees−£5,000−£5,000
= Cash released / (needed)Borrowed money—never counted as income+£111,250+£15,000
Cash per project incl. shortfall£167,766£77,045
Cash left investedSeparate from property equity£56,516£62,045
Long-term loan interest a monthIllustrative, interest-only£2,131£2,131
Net rental cash flow a month£61,000 a year rent, less 15% running costs, 5% vacancy and loan interest+£1,935+£1,935
Months of rentRent starts after the works5151
Total net rent+£98,706+£98,706
One-off costsBridging interest & fees, purchase costs, refinance fees—counted once−£70,516−£76,045
= Result per projectBefore tax+£28,191+£22,661
Development spendWorks + contingency, shown separately£66,000£66,000
Property equity after refinanceFinished value less the new loan. Unrealised—not cash, not in the result£155,000£155,000
Net rent ÷ cash left in, a year41.1%37.4%

How this model works

  • Bridging buys the property. Works and contingency come from your cash.
  • Interest is paid monthly. The full forecast interest is reserved upfront.
  • Fees are paid separately unless marked as deducted from the loan.
  • The bridge pays for the purchase and the works, up to the lender’s limit.
  • Interest is charged on the full loan from day one, to be prudent.
  • No rent during the works. Refinance onto a long-term loan when they finish.
  • That loan is interest-only. No sale, no growth in rent or value.
  • Whole properties only. Any refinance shortfall must fit in the pot too.
  • Borrowing and refinance cash are never counted as income or profit.
  • Before tax. Approval, valuation and refinancing are never guaranteed.

Bigger plans deserve proper sums.

Lower cash needs don’t guarantee higher profit. Talk your real numbers through with us. Terms and conditions apply.

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