Bridging Loans Newcastle

Buying property is the most significant investment most people will make in their lives. It’s important that you have the money you need to complete the transaction and explore all opportunities you come across.

The more readily available your finances are, the better your chances of getting the best deal.

While mortgages are the most common way to get the money for property purchases, using traditional financing isn’t the best choice for people who need money as soon as possible.

Many lenders require you to deposit at least 25% of the property value to complete the transaction. Keep in mind that it may take several weeks, if not months, to process an application with a high street bank.

Not only can it take months to receive approval for a mortgage, it could take weeks to be denied – that’s a lot of wasted time you can’t afford.

 

What is a bridging loan?

• Bridging loans are a way to bridge the financial gap between two points. These financial products offer you a fast and flexible way to get money.
• All bridging loans are secured against property, and you can secure one against most types of property.
• The money from these loans can be used for almost any purpose, but they are typically used by individuals and property developers who want to secure a property purchase but haven’t gotten a traditional mortgage because it would take too long or they don’t meet strict lending criteria set out by lenders.
• A bridging loan is also used to bridge the gap between selling your current home and buying a new one, especially if a sale falls through or the property takes longer to sell than expected.
• If your property is in England, Wales, or Scotland, you can use it for a bridging loan. Most properties can be used for this type of loan, including commercial properties, residential properties, and undeveloped land.
• Bridging loans are intended for short-term usage and to offer a temporary cash flow to those who need it.

 

What do bridging loans offer?

• A fast and short-term funding solution when you need money in a hurry
• Anywhere between £50,000 and £25m
• Flexible loan terms to suit your needs with financing

 

What can bridging loans be used for?

The money from bridging loans can be used for almost anything, but here are some of the most common uses:

 

To purchase property

You’ll typically need to make a down payment on property. If you don’t have a mortgage in place before you start looking, bridging loans can help make that deposit while you arrange a more permanent financial solution such as a mortgage.

 

Downsizing

There’s no telling when your current property will sell. A bridging loan helps you find a new home while waiting for your current one to sell.

 

Development and refurbishment

You likely won’t find a mortgage option that lets you renovate and refurbish property. A bridging loan is a great way to get the money to make your home look good as new.

 

Buying at auction

Buying property at auction requires a deposit like buying property normally. Bridging finance helps cover those costs.

 

Buying international property

Buying property abroad takes even longer than buying a home in your home country. These financial products help secure the funds you need to make it happen.

 

Completing a property purchase if something goes wrong

A chain is only as strong as the weakest link. There’s plenty of potential for things to go wrong in the property chain, such as a buyer not securing a mortgage.

These setbacks can cost you a lot of time and money. Bridging finance closes these gaps and pushes the sale through no matter what.

 

Bridging finance exit plan

The “exit plan” is an essential part of the process. Lenders arrange an exit plan to verify how you plan on repaying the loan. Lenders will generally want to know your exit plan before they clear the money. Paying back the loan with money from a property sale is one example of an exit plan.

 

Choosing a bridging loan provider

With all the different bridging loans available, it’s essential you understand your choices and what it means to take out a bridging loan.

If you have any more questions or want to arrange a bridging loan of your own, please don’t hesitate to get in touch. Alternatively, if you could like to calculate fees for your finance, you can use our bridging loan calculator.