Somo cuts business owner’s monthly repayments by 78% with £466k second charge
Somo has completed a £466,200 second charge bridging loan for a UK business owner living in the US, reducing his monthly repayments from over £24,000 to just £5,232 – a reduction of more than 78%.
The challenge
The borrower had taken out an unsecured business loan of £455,000 with iwoca to buy out a former business partner and increase his shareholding.
While the loan had served its purpose, it carried an interest rate of 2.45% per month, with repayments of at least £24,122, including both capital and interest.
Despite an accountant-verified annual income exceeding £700,000 and a clean credit history, the borrower was unable to refinance onto a conventional mortgage because he was newly self-employed and didn’t yet have two years of accounts.
He needed a short-term solution to clear the expensive debt and significantly reduce his monthly commitments.
The solution
Somo provided a £466,200 second charge bridging loan over 12 months, secured against the borrower’s UK home in Essex, valued at £750,000.
At a rate of 1.15% per month on an interest-only basis, the facility reduced his monthly payments to £5,232.
The deal required a pragmatic approach to underwriting. Somo would ordinarily require the borrower’s solicitor to repay an existing facility directly on completion. However, as the iwoca loan was unsecured, this wasn’t possible.
Rather than decline the case, Somo found an alternative solution, incorporating a condition into the loan agreement requiring the borrower to repay the debt within two working days of drawdown and provide written confirmation.
With the borrower based in the US, the transaction was completed remotely using digital identity checks and a US notary.
The outcome
Completed in June 2026, the loan reduced the borrower’s monthly outgoings by £18,890 – a saving of more than 78% compared with his lowest previous repayment.
The monthly interest rate was reduced by more than 53%, saving approximately £5,915 in interest costs alone each month.
The 12-month facility provides valuable breathing space while the borrower builds the trading history needed to pursue a conventional mortgage refinance.
The comment
Rob Johnson, Somo’s underwriting director, commented: “This borrower had a strong income and clean credit history, but without two years of self-employed accounts, conventional mortgage finance wasn’t an option.
“Rather than let that stand in the way, we found a practical solution that reduced his monthly outgoings by almost £19,000. The unsecured nature of the existing debt also required a different approach, but we were able to structure the loan to give us the assurances we needed.
“It’s a great example of how solutions-focused specialist lending can make a real difference, providing immediate financial relief and a route to longer-term finance.”