Bridging Loan Tips

Understanding how a bridging loan works is key to making best use of this form of finance!

• Your circumstances dictate that you need a UK Bridging Loan Fast! If you need to complete within a very short timescale such as 48 hours, then remember your own professionals such as your solicitor need to be available. Much of the necessary background work will need to have been already completed to achieve the deadline!
• Loans below £100k may attract premium pricing as bridging companies require a minimum return to make any particular deal worthwhile.
• Remember if your loan plus any rolled up interest reach the lenders maximum loan to value will need to be able to cover the interest payments.
• Lenders can choose to offer a loan with fees and interest for their minimum term deducted from the initial advance.

Hints and tips for applying

Here are four facts to think about when you are applying for a bridging loan.

• The cheapest bridging loans are those lent against purchase price.
• If you want to achieve higher loan to value borrowing, arrange to borrow against the open market value of your property.
• If you are a property developer looking for a bridging loan above normal loan to value ratios you may be eligible for mezzanine finance, to find out more about those get in touch.
• A larger bridging loan is more cost effective than a small one. You can roll-up the interest payments but remember, only to the lenders maximum loan to value.