What is a bridging loan – in detail

What is a bridging loan – in detail

A bridging loan is a short-term finance arrangement designed to ‘bridge the gap’ between a purchase and a more long-term funding arrangement, such as a property sale within a chain, or the arrangement of a longer-term finance arrangement, such as a mortgage. In this article, we will look at the features of these loans in depth.

Essentially, when a property buyer needs to rapidly access cash to buy a property with the minimum of time, hassle and paperwork, a bridging loan is often the chosen route. Property bridging loans are used by individuals, companies, trusts and businesses alike – from individuals looking to facilitate a residential property transaction through to developers and businesses looking to manage large and complex commercial property portfolios.

Property bridging finance companies offer various sub-categories of bridging loan, such as auction finance, to meet a variety of needs. There are also bridging loans for residential, semi-commercial and commercial property transactions, including refurbishment projects. These financial tools are complex and sophisticated loans which are designed for experienced and well-informed borrowers who are clear about their features, and who have a clear project and exit strategy in place.

Property bridging loans should only be used when the borrower has a plan to repay the bridging loan at the redemption point, and should never be taken out without a clear exit plan, or they can become extremely expensive and risky (with this risk already priced into the higher monthly interest charge.)

Bridging loan examples

Property bridging loans are both specialist in nature and flexible in their application. The following examples illustrate how they can be used:

  • By an individual who wishes to buy a residential property whilst awaiting the sale of another to complete.
  • By a developer who wishes to refurbish or improve a property which is deemed to be unfit for human habitation and is currently ineligible for a standard mortgage.
  • By a company which buys properties at auction, and needs to secure rapid finance to secure the deal, whilst organising more long-term finance.

Why choose us as your bridging finance broker?

Our clients choose to work with Hank Zarihs Associates time and time again for a number of key reasons. These include:

  • Access to the best rates

We work with a respected panel of experienced lenders with a great track record in the field. This means that our clients gain access to the best rates and loan products from lenders that they can trust.

  • Access to the most loan products

Most bridging loans simply aren’t available on the open market, as these are specialist products and many bridging finance companies prefer to go via brokers for the value-add role that they provide. If you are looking for bridging finance in the UK, then Hank Zarihs Associates can gain you access to the widest range of attractive loans, including deals that you wouldn’t find if you searched direct..

  • Quick and Efficient

We pride ourselves on offering a fast and efficient service. It takes just payday loans in Wyoming a few minutes for us to gather our initial information in order to gather quotes from interested development lenders for your finance. We can obtain your loan offers typically within the hour. Once you have chosen your preferred loan and wish to go ahead, it takes an average of 7 days to arrange your bridging loan, but we also work with lenders who can provide them on a faster basis. Need an immediate bridging loan? Call us today for a rapid solution.

  • Apply for a bridging loan today!