Bridging is often used when speed is an important factor, such as auction purchases. We have access to lenders that can complete facilities within 48 hours.
Acceptable security includes:
Security can be taken as a first, second or third legal charge, subject to consent from any other lenders remaining in situ. Multiple items of security can be taken for a single loan.
Affordability and repayment
Bridging loans are interest only facilities. Interest can often be rolled up, meaning there is no monthly payment to make and the cost of the loan is paid on final repayment. Interest can also be serviced monthly.
A key consideration for lenders is “how will the loan be repaid”. You will need to demonstrate a clear plan of how and when the loan will be intended to be paid off. This is usually via sale of the property or refinance.
Ownership structures
Acceptable customer types include: Sole Trader, Partnership, Limited Company (Ltd) or Limited Liability Partnership (LLP).
Loan terms and lending criteria
Bridging loans are available up to 75% Loan to Value (LTV). For commercial properties, this is likely to be capped at 65%.
Credit history is less of a concern when considering Bridging Finance, therefore clients with adverse credit can often be supported.
Pricing and fees
Interest rates can vary dramatically, ranging from 0.6-2% per month. Arrangement fees range from 1-3% and can be added to the loan.
