A bridging loan can be an excellent choice when you are in the process of buying a new property or require immediate access to extra funds. This type of loan can provide a flexible and effective solution in a wide range of situations, offering a bridge between short-term financial needs and longer-term goals.
For example, a bridging loan may be a great option if you are selling your home and need financial assistance to pay for your next property or simply cannot access the funds for the required deadlines.
At Bridging Finance Solutions, we have years of experience providing bridging loans to those who need them. Read on to learn more about our bridging finance options and how we can assist you with your financial needs.
What Is A Bridging Loan?
A bridging loan is a short-term solution that can be used to ‘bridge the gap’ if you are looking to purchase a property before selling another or if you need to obtain funds quickly for a property-related transaction.
Bridging loans can be used as a mortgage alternative because they can be obtained quickly and require a much shorter commitment. If a bridging loan is arranged with us, you will be expected to repay it within 12 months, which can be negotiated depending on your circumstances. It is essential that there is a viable exit to repay the loan when it is time to redeem.
Some reasons for applying for a bridging loan include:
- Buying a property at auction.
- Purchasing an unmortgageable property.
- Improving/renovating a property.
- Purchasing from a vendor that requires a quick sale.
- Needing a quick cash injection.
Another common reason for taking out a bridging finance loan is if you are in the transitional period between purchasing and selling a new property and have been let down by a prospective buyer, traditionally known as chain breaking.
A bridging loan can give you the finances you need to continue with your purchase.
Speed is the main reason people choose to take out a bridging loan, as it can be arranged at very short notice. Bridging Finance Solutions doesn’t answer to a third party, we can provide loans quickly.
Which Bridging Loans Do We Offer?
At Bridging Finance Solutions, we are at the forefront of bridging finance because we offer loans to fit any circumstance. As a principal lender, we have the resources to process your loan requests quickly and provide funds to you as soon as possible.
No two circumstances are the same, and we pride ourselves on being able to deliver financial assistance in various situations.
Development Finance
If you are a property development professional, we can offer residential development finance for your next project.
Our property development loans start from £50,000 and can extend to £2,000,000. They can be used for property development, house clusters, permitted development schemes, and developments built from the ground up.
Capital Release Bridging Loans
Though the typical use of a bridging finance loan is property investment, there are other circumstances whereby we can provide the required funds. Providing a loan for a cash injection into a business. If you are equity-rich but cash-poor, a bridging loan could offer you the solution you need.
Some reasons you may require an emergency cash injection include:
- Emergency restock.
- Tax payments.
- VAT payments.
- Temporary cash flow issues.
- Divorce settlements
- Inheritance Tax
Probate Bridging Loans
Losing a family member is never easy, and the last thing you want to worry about during that difficult time is your financial situation.
Losing someone can be expensive; with funeral costs, legal fees, and inherited debt, it can be easy to become financially overwhelmed, and this is where we help.
Our probate loans work the same way as our standard bridging loans and will be charged to a property; we can discuss the terms with you and determine what you need to meet your financial needs, offering anywhere between 1 and 12 months to make repayment.
We understand how difficult dealing with probate can be, so we are open to discussing extending your repayment time.
We always take a people-first approach and create a structured repayment plan that fits a repayment schedule you can manage.
Tax Payment Bridging Loans
A bridging loan may be the right solution if you have time-critical debts that you need to repay and want to avoid untrustworthy payday loans and schemes. It can also offer a quick solution if you are waiting for finances to be released from another property or sale.
There are a lot of associated risks that come with not paying a tax bill on time, so a bridging loan can buy you some much-needed time to re-arrange your finances.
Short Term Cash Flow
Bridging loans are often misconstrued as only being available for property transactions. However, they can also provide financial assistance to any organisation experiencing a short-term cash flow problem.
There is no shame in needing financial assistance, as circumstances can change, and you may experience a financial gap in your business needs.
A bridging loan can be a great option while you uncover a more permanent solution for your financial problems.
Regulated and Unregulated Bridging Loans
When applying for a bridging loan, you must consider whether you will need to apply for a regulated or unregulated loan.
The Difference Between Regulated and Unregulated Loans
The main difference between regulated and unregulated loans is the Financial Conduct Authority governs regulated bridging loans.
Regulated loans are usually secured against residential property, whereas unregulated loans are usually secured against commercial or investment properties.
Auction Finance
If you are looking to purchase a property below the standard market price, a good option is to purchase it at auction. Initially, purchasing a property for a lower than market price could lead to higher profits, so it isn’t surprising people buy at auction.
Though there are lots of advantages to purchasing a property at auction, you are usually under much stricter time constraints in terms of securing the necessary funds to complete the purchase.
At the very least, you are expected to pay a deposit on the day of purchase, and you will usually only have 28 days to complete the purchase. Very rarely can a property be purchased at auction using traditional mortgage methods.
If you are dependent on selling another property to finance the purchase of your auction property, you may run into difficulties operating under such strict time constraints.
Bridging Finance Solutions can help you raise the funds you require to complete the transaction within the required timeframes.
How Long Does a Bridging Loan Take With Bridging Finance Solutions?
Bridging Finance Solutions aims to approve applications as quickly as possible. We often provide funds to clients within ten days of application.
Bridging loans can be arranged in as little as 5-10 days, depending on your preparedness. We have completed funding in less than 48 hours in the past, so we are more than equipped to offer you the timely financial assistance you need.
If you want the process to run smoothly, ensuring you have the correct documentation prior to submitting your application will allow us to process the application faster. Give us a call and we can walk you through the process.
The Benefits of Taking Out a Bridging Loan
Fast Access to Funds
One of the most significant advantages of taking out a bridging loan is its quick access to funds. If you were to take out a traditional mortgage, you can wait months for the loan to be completed.
A bridging loan can be obtained in a few days, making it ideal for quickly settling financial difficulties. When you are experiencing financial problems, waiting around for money is the last thing you want to experience, and with us, you don’t have to.
Alleviate Funding Gaps
People experiencing financial gaps can drive themselves further into debt, so having a solution such as a bridging finance loan can create a short term answer until a property is sold or an investment is realised.
Creates More Property Purchasing Potential
When applying for a mortgage, the property must be habitable, which creates limitations if you want to purchase a property with no kitchen or bathroom facilities.
By applying for a bridging loan, you have much more flexibility regarding the type and condition of the property you wish to purchase.
Apply For a Loan With Bridging Finance Solutions
If you want to know more about what to expect from a bridging loan or whether you fit the application criteria, contact our team today, and we can discuss your eligibility.
Alternatively, fill out our application form, and a team member will contact you shortly.
BFS can make it happen for you.
