Bridging finance for commercial properties
Bridging finance for commercial mortgages is a short-term loan that is used to “bridge” the gap between the purchase of a property and the long-term financing that will eventually be used to pay off the loan.
It is commonly used when a property is being purchased before the sale of the current property has completed, or when a property is being purchased at auction and the funds are not immediately available.
The loan is typically secured against the property being purchased and is typically paid back within a year, either by refinancing the property with a long-term loan or by selling the property.
Bridging loans can be used for a variety of purposes. They are short-term loans that are used to cover the gap between the purchase of a new property and the sale of your old one.
Bridging loans can be a great solution for people who need extra time to sell their old property or for those who are looking to purchase a new property before their current one is sold. Bridging loans can be an attractive option for people who have equity in their current property and are looking to avoid the costs of a traditional loan, such as early repayment fees.
How does a bridging loans work?
Bridging loans work by providing you with the money that you need to cover the gap between your old and new property. They are a short-term loan, which means that you will have to pay it back within a set amount of time. Bridging loans can be used for other purposes, such as home improvements.
Bridging loans can be a great option if you need to cover a large expense quickly. They are also a good choice if you don’t have the credit score that is required for a traditional loan. Keep in mind, however, that bridging loans do come with a higher interest rate than traditional loans.
Who should consider using a Bridging Loan?
Bridging loans can be a great option for anyone who needs to cover a large expense quickly. They are also a good choice for people who don’t have the credit score that is required for a traditional loan. Keep in mind, however, that bridging loans do come with a higher interest rate than traditional loans.
If you are considering using a bridging loan, make sure to compare the interest rates and terms from different lenders. You should also be aware of the risks involved with bridging loans, such as the possibility of losing your home if you can’t repay the loan on time.
What types of bridging loans do we offer?
Our bridging finance specialists are on hand to work with you on your commercial property requirements. We offer the following types of bridging finance options:
- Residential Bridging finance
- Investment Bridging finance
- Development Bridging
- Auction Finance
- VAT Bridging
What is the process of getting bridging loan?
Applying for a bridging finance is a simple process, you will need to provide some basic information, such as your name, address, and contact information.
You will also need to provide information about your current and proposed commercial property that you are needing finance for, including the purchase price and sale price.
Your lender will also likely require a copy of your current mortgage statement and proof of income. Make sure to have all of this information ready when you apply for a bridging loan.
What is the criteria for commercial bridging finance.
The eligibility criteria for borrowers of bridging finance can vary depending on the lender and the specific loan. However, some common criteria include:
- Credit score: Lenders will typically check the credit score of the borrower to ensure they have a history of making payments on time and managing credit responsibly.
- Income: Lenders may require proof of income and may have minimum income requirements for borrowers.
- Property value: Lenders will typically assess the value of the property being purchased to ensure that it is worth enough to secure the loan.
- Purpose of the loan: Lenders may have specific requirements for the purpose of the loan, such as the property being purchased must be intended to be used as a commercial property.
- Exit strategy: Lenders may require borrowers to have a plan in place for how the loan will be repaid, such as through refinancing with a long-term loan or by selling the property.
- Asset ownership: Lenders may require the borrower to show proof of ownership of assets such as property or savings, to ensure they have the resources to repay the loan.
It is worth mentioning that the criteria may vary depending on the country and the lender, and certain lenders may have more relaxed or strict criteria than others.
What are the risks involved with bridging loans?
Bridging finance come with a few risks, such as the possibility of losing your home if you can’t repay the loan on time.
You should also be aware that bridging loans have a higher interest rate than traditional loans. Make sure to compare the interest rates and terms from different lenders before you decide to use a bridging loan.
Please contact us now for more information and to speak with one of our professionals.