What is bridging finance and when is it useful?

Bridging finance was designed to allow consumers to close on a new property acquisition before selling their present house; it is a short-term finance that is repaid when the existing property is sold. However, bridging finance has now evolved into much more.

While it may still be used to ‘bridge’ the gap between selling and acquiring a new home, it can also be used to fund a wide range of projects, from renovations and conversions to more sophisticated projects.

Bridging finance today has limitless applications for financing where traditional lenders would not lend.

When do you need bridging finance?

Bridging finance is appropriate for many situations, including:

  • Financing un-mortgageable or complex title properties.
  • You have a time-sensitive situation and want funding immediately.
  • High-street lenders will not help you.
  • Need money to fix up a house to sell or refinance.
  • You require a development exit strategy.

What are the benefits of bridging finance?

Quick Process

Obtaining the funds, you want with bridging finance can be extremely quick and efficient. In fact, the loan could be paid out in a couple of days. When compared to the many weeks it takes to qualify a traditional loan or mortgage, it’s clear to see why people in a hurry are turning to bridging loans.

Limitless potential applications

Most traditional banks and lenders are quite explicit about what they are and are not prepared to examine when approving loan applications. A bridging loan, on the other hand, can be utilised for almost any purpose without hesitation. The reason for your application is irrelevant as long as you can demonstrate that you can repay the loan on time.

Flexible repayment options

Bridging finance lenders are far more flexible than banks in terms of how and when you repay your loan. Bridging loans provide considerably more flexibility in terms of loan length and interest payments.

Relaxed lending criteria

The vast majority of bridging loans are secured by a valuable asset, generally a home or property of some form. As a result, the rest of the standard lending criteria are rendered outdated. Credit ratings, proof of income, present financial situation, and so on are irrelevant if you can put up the appropriate collateral.

Are you interested in bridging finance?

Veracity Financial Planning are expert independent financial advisers in Nottingham and the East Midlands. We understand our clients’ unique circumstances and find bespoke solutions to get the best deals on the market.

If you are looking for bridging finance, please contact one of our financial advisers today.

ABOUT THE AUTHOR

Picture of Woody Snapper

Woody Snapper

Woody works with individuals and business' looking for corporate finance, high net worth mortgages, complex loans, bridging loans and development finance.

To contact Woody.

Tel: 07922 413586

or

Email: woody@veracityfp.co.uk