Property finance is built on timing. Borrowers and lenders agree terms on the assumption that projects will complete, sales will exchange, or refinancing will be in place by the time the loan matures. But even the most carefully planned deals can slip. Construction programmes overrun, buyers withdraw, refinancing stalls at the credit committee stage — and suddenly a borrower is staring at a maturity date with no repayment in sight.
For lenders, this is the nightmare scenario. As we explored in Why Exit Risk Keeps Lenders Awake at Night, repayment uncertainty undermines confidence not just in one deal, but in a lender’s entire book. For borrowers, the pressure is even greater. Default interest can double the cost of borrowing overnight, legal action can begin within days, and reputational damage can close doors on future projects.
This is what we mean by a last-minute exit: the scramble to find a solution when time has almost run out. It is not a position any borrower should aim to be in — and, as we stressed in Why Every Bridging Loan Needs a Clear Exit Strategy, prevention is far better than cure. But when prevention has failed, borrowers need to know whether a deal can still be saved, what options remain, and how to act under intense time pressure.
These situations rarely appear out of nowhere. They are usually the product of creeping delays that compound over months. A developer may underestimate build times, assuming practical completion will be achieved in twelve months when eighteen was more realistic. Or a sales strategy may depend on off-plan buyers completing quickly, only for mortgage approvals to drag out far longer than expected.
Refinancing is another frequent trap. A borrower may have a term sheet in hand from a long-term lender, only for the application to collapse during underwriting because income evidence is incomplete or valuations fall short. By the time the borrower realises, weeks have been lost, and the original facility is already at maturity.
Sometimes the issue is behavioural rather than structural. Overconfidence, particularly among experienced developers, can be dangerous. A borrower who has “always refinanced easily before” may assume the same will happen again, only to find lender criteria have shifted in 2025. By the time they seek advice, they have days rather than months to fix the problem.
The consequences of running out of time are immediate and severe. Once a loan passes maturity without repayment, it is officially in default. For the lender, this changes everything. Interest rates typically jump to default levels — sometimes double or triple the standard rate — and they are charged daily. A borrower who is only a few weeks late may find their cost of borrowing spirals by hundreds of thousands of pounds.
At the same time, legal enforcement options become available. Lenders can appoint receivers, take control of the asset, and begin forced sales. These processes are not designed to maximise value for the borrower; they are designed to recover capital for the lender. Properties are often sold at discount, and profits that would have been achieved under normal conditions evaporate.
Reputation suffers too. In a market as interconnected as property finance, news of defaults travels quickly. A borrower who fails to repay on time will find credit committees reluctant to engage on future deals. As we outlined in The Cost of a Failed Exit, the long-term damage to credibility can be worse than the immediate financial penalty.
Despite the risks, last-minute exits are not always doomed. The key is speed, credibility, and professional expertise. Lenders may be sceptical, but they are also pragmatic: they want their capital back. If a borrower can demonstrate a clear and achievable path to repayment, even at the eleventh hour, deals can be salvaged.
Take, for example, the borrower who has exchanged on several sales but not yet completed. If evidence of exchanged contracts is presented to the lender, many will agree short extensions to allow completions to finalise. Another borrower may have a refinance offer agreed in principle but stuck in legal process. With the right broker pressing the case, lenders may grant a short extension if convinced repayment is genuinely imminent.
Even where no extension is possible, emergency refinancing may provide a solution. Specialist short-term lenders exist precisely for these scenarios. They can step in quickly, repay the original lender, and give the borrower additional months to complete sales or secure long-term refinancing. Rates may be higher, and terms stricter, but the alternative — default, enforcement, and reputational damage — is usually far worse.
In early 2024, a developer approached Willow with just three days left before a £6 million development loan matured. Sales had been agreed on half the units, but buyer mortgages had been delayed, and no completions had taken place. The refinance lender had withdrawn at credit committee, leaving the borrower without an exit.
Within hours, Willow secured agreement in principle from a specialist bridging lender, fast-tracked a valuation, and engaged legal teams on both sides.
The facility completed with 72 hours to spare, repaying the original lender in full. The new loan gave the borrower six months to complete sales, which proceeded gradually and at full value.
The costs of the emergency refinance were higher, but they were dwarfed by the profit preserved and the reputational damage avoided. For the borrower, the lesson was clear: while last-minute exits are possible, they require specialist intervention and a willingness to act decisively.
It is important to recognise that last-minute exits are not free. Emergency refinancing facilities are priced for risk, meaning interest rates are higher and leverage is lower. Lenders may insist on greater equity contribution or stricter covenants. Legal and valuation costs are also magnified because of the urgency.
Borrowers who rely on last-minute exits repeatedly will find themselves in a downward spiral. Each rescue comes at a higher cost, eroding profit margins and limiting future opportunities. In some cases, borrowers become trapped in a cycle of emergency refinances, each more expensive than the last. The result is diminished credibility and, eventually, insolvency.
This is why experienced developers and investors treat last-minute exits as a safety net, not a strategy. The goal is not to avoid planning but to ensure that if delays occur, there are options available to avoid default.
The surest way to handle last-minute exits is to never require one. That means building exit planning into every stage of the project, from the very first conversation with lenders.
Developers should apply for refinancing well before maturity, leaving time for valuations, underwriting, and legal process. Sales strategies should allow generous time for completions, particularly where overseas buyers or complex funding is involved. Contingency planning is essential — as discussed in Navigating Valuation Gaps, borrowers should stress-test their plans against conservative assumptions rather than optimistic ones.
Above all, borrowers should engage brokers early. Brokers not only secure the initial facility but also test exit strategies with live lenders, ensuring that refinance is achievable and that fallback options exist if sales slow or valuations disappoint.
At Willow Private Finance, we regularly work with borrowers facing last-minute exit challenges. Our relationships with specialist lenders, private banks, and legal partners mean we can act quickly when deadlines loom. But more importantly, we structure deals from the start to ensure clients never end up in this position unnecessarily.
In one recent case, a borrower refinancing an HMO portfolio underestimated rental stress tests. Willow identified the issue early, restructured the loan, and avoided the scramble that would have occurred months later. In another, we advised a developer to build contingency into their exit plan by securing part-sale agreements in advance, ensuring that even if refinance faltered, repayment would still be achievable.
These examples highlight our philosophy: prevention first, rescue if necessary. For borrowers, that means peace of mind, confidence in lender relationships, and protection of both profit and reputation.
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About the Author — Wesley Ranger
Wesley Ranger is the Founder and Director of Willow Private Finance. With two decades of experience resolving property finance crises, he is often the first call when borrowers face imminent default.
Wesley specialises in structuring emergency refinancing and negotiating extensions with lenders, but his true expertise lies in designing strategies that prevent clients from ever needing a last-minute exit in the first place.
Important Notice
This article is for information purposes only and does not constitute financial advice. Property finance carries risk, including the risk of default or repossession if loans are not repaid. Exit strategies should be assessed carefully and tailored to individual circumstances. Always seek professional advice before entering into any finance agreement. Willow Private Finance is directly authorised and regulated by the Financial Conduct Authority (FRN: 588422).
