What are the advantages of a fast bridge loan?
When speed is a necessity, bridge loans can often facilitate a myriad of transactions – especially property transactions for larger sums, when you may have funds tied up elsewhere or are stuck in between purchasing a new property and selling your existing one.
The obvious benefit is speed, and we can secure you short term financing, (depending on the amount required) within a week to two weeks – as most bridge loans last a term of 12-36 months.
If you need a bridging loan urgently, then the flexibility of our service will allow you to get a successful application through to lenders – and you’ll be able to sort through all your available options and scope out the best possible deal when time is of the essence.
Why is a bridging loan broker useful?
By applying for finance through a broker, you gain access to more options and can save a lot of time.
Here’s what an experienced broker can do for you when it comes to applying:
- Brokers have access to the entire market of lenders, of which some may be unavailable to individuals going direct – brokers will get you; comparative rates, leverage favourable terms for you, and assist with the application process.
- Brokers can advise on the best course of action and see that your exit strategy and plans are solid. They will help with options, how best to proceed, and answer your questions.
- Brokers create a competitive environment – this can lower rates overall.
- Brokers know how to best present a client’s situation to lenders, making borrowers a more appealing option.
- They will help you understand and guide you through the entire process – dealing with documentation, giving you an indicative quote, and dealing with lenders on your behalf.
- They will work through your interests to secure the best deal possible.
While there is an additional cost, this is offset by the speed in which a bridge loan can be organised and delivered through a broker – and it is essential, especially for the inexperienced, when preventing mistakes that can occur in a time-sensitive matter when you’re in need of a quick solution.
Should I go to a lender directly?
While nothing stops you from approaching lenders directly – it can prove more of a hindrance than a benefit.
If you're inexperienced in bridging loans and you are simply looking for a quick solution, then applying for finance through a broker is often the more popular choice.
It can often be difficult to recognise whether a lender best suits your circumstances – since bridge loan lenders often deal in bespoke products with specialisations in different areas.
With our services, we can find the right lender without you going through the hassle. We can determine exactly what type of loan you’ll need, and we can organise finance a lot quicker due to our connections and established relationships with lenders. The speed at which a bridge loan can be secured is down to the efficiency of working through expert bridge loan brokers.
How much can I borrow?
With bridge finance, there aren’t many upper limits – yet, the loan available to you will ultimately be determined by a number of factors and criteria.
The bigger the security, the more you may be able to borrow.
A lender will calculate your borrowing power using your loan-to-value (LTV), calculated by dividing your loan amount by your securities value – this will determine exactly how much you’ll get.
Here are some of the key factors which will determine the amount you can borrow:
- The value of the security or assets (property)
- Location of property
- The length of the loan term
- Your financial circumstances
- The LTV (Loan-to-Value) percentage - the loan amount divided by the appraised property or assets value.
Offering multiple properties as security will increase the upper limit of your borrowing potential through a higher LTV percentage.
The value of the assets you plan to offer as security must be sufficient to cover the loan - taking into account interest payments or additional fees.
It is always important to remember your exit strategy, which will typically be the property your loan is secured against – it is helpful to have a solid, calculated plan before applying and to consider carefully how long the loan will last.
How do I apply for an urgent bridging loan?
Bridge loans can always be organised relatively quickly, so the application process will not differ regardless of how quickly you need the funds.
However, with a bridging specialist’s help, you can be pointed in the right direction based on your needs.
What you will need is this:
- A form of security, typically property(s) - or a high value asset, which a loan can be secured against.
- A repayment plan, and a solid exit strategy. Bridge finance is considered a higher risk form of lending, so naturally, a lender will want to know how you intend to repay and will need some assurances. However, the exit strategy is usually through the sale of the property the loan is to be secured against, or it could be through refinancing with a traditional mortgage loan.
With bridging loans typically being secured with property, most lenders will not need proof of income – bridge loans are repaid at the end of the term, alongside interest payments. Hence, a borrower’s income is not usually a roadblock in terms of having a successful application. They are mostly concerned with the worth of the collateral.
Urgently need a bridge loan? - Get in Touch
In a time-sensitive situation, bridge loans offer both speed and flexibility -and with our help, you can find the best possible deal and have the whole process streamlined through our access to a variety of specialist lenders.
What we can offer:
- Both residential and commercial loans, and development property finance.
- Flexible terms (Terms from 1-36 months)
- As much as 80% LTV (more if other assets are involved)
- “Rolled-up” interest schemes
How we can help:
- We can secure bridging finance for any type of borrower – limited companies, individuals (no upper age limit), sole traders, partnerships, and trusts.
- We have established relations with a network of both niche and specialist lenders
- Finance within 7 working days, depending on the complexity of a case, and can be quicker when there is a need for urgency.
- We can make you feel at ease with the process, find a loan most suited and help you decide whether an urgent bridge loan is right for you.
- At Clifton Private Finance, our bridge loan experts will help you avoid the common mistakes and pitfalls of those looking into short term finance.
We will be able to answer any questions you have, so get in contact with our team at Clifton Private Finance to book a consultation and start viewing all your available options and the best deals through our broker service.
Bridging loans can be used for:
- Bridging the gap between purchase and sale - Secure a property fast before it is snapped up by another buyer – even if you have not yet sold your current home
- Buying a property to renovate and sell - Short term finance provides an excellent way to flip property quickly within a 12 to 24 month timescale.
- Downsizing - Timings between buying and selling an existing property are rarely aligned. A bridging loan can smooth the process.
- Mortgage chain issues? - Secure your ability to buy even in the event that the home buying chain breaks down – for example, if the sale of your old house falls through, a bridging loan can allow you to still have sufficient funds to purchase the new house
- Buying an auction property? – use a bridging loan to pay the required percentage needed to secure the property on the day of the auction
- Need to move fast? - Get a fast, temporary cash injection when you most need it during the property purchasing process. The ability to move quickly can make the difference on any property transaction.
- Development finance - If you are buying property to redevelop and you need finance to get your project off the ground then a bridging loan could help make the difference
- Lease extension - Extending a property lease can be costly and may be necessary before a mainstream lender will consider giving you a mortgage. A bridging loan to purchase a lease extension can provide you with the funds to make this happen.
- Commercial property - Finance for purchase or refinancing and making property improvements.
To investigate your bridging loan options call us on 0117 959 5094
