Bridging finance is a short term secured loan for the purpose of funding the purchase or development of property. The loan is maintained until such time as alternative funds become available or the property is suitable for sale or refinancing.
Bridging loans are normally available for terms between one month and up to twelve months. All lenders will require an exit strategy, i.e. confirmation of how the loan will be repaid.
At face value bridging finance is far more expensive than a mortgage, certainly in terms of interest rates and fees. However, if speed is of the essence, bridging finance may make the difference between securing or losing a highly profitable deal so the costs of financing need to be weighed against the potential loss of opportunities to make profits.
Bridging loans are appropriate for purchases where there is a limited time to arrange finance, for example when purchasing a property at auction. Bridging lenders will review risks vs. profitability and are able to offer fast decisions and a provide a written offer within a matter of days.
Bridging finance is also appropriate where there is a short term delay between completion of the sale and purchase of two properties. For development projects bridging finance can be a faster route to finance, however the short term nature of these loans means that a secure exit strategy must be well thought through at the outset.
All of our Commercial Brokers are members of the NACFB (National Association of Commercial Finance Brokers), they carry Professional Indemnity Insurance and subscribe to the NACFB Code of Practice which is registered with the Office of Fair trading.
Your request for contact will typically be followed up the same day during office hours.
If you have any questions please do not hesitate to contact us 9-5 Monday to Friday: 01603 428500