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How can I get a bridging loan? Find out with Simply Specialist Lending
If you need to access capital quickly for a commercial or residential property purchase, a bridging loan (also known as bridge loans) could be the answer. The bridging loan brokers at Simply Specialist Lending can help you find the most appropriate bridging finance for your project. We have access to a range of bridging loan companies who offer the type of flexible and versatile finance you’re looking for.
Speaking to Simply Specialist Lending could be your first step to securing a bridging loan for property refurbishment or to get the funds you need to buy a property while you wait to sell your existing one. We can talk to you about the cost of a bridging loan and whether it is the best solution for you, whether you are considering a bridging loan for a house purchase or looking for commercial bridging finance.
We can give you advice about all types of bridging loans including property bridging loans, business bridging loans, second charge bridging loans, development loans, and even bad credit bridging loans. If you’re considering taking out a bridging loan, contact us today for your free initial consultation.
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Bridging Loans Explained
What is a bridging loan?
A bridging loan is a short-term loan designed to help people or businesses ‘bridge’ a gap in finance. They are often used to provide funding while you find a more traditional source of finance or if you are awaiting funds coming in. The term of a bridging loan is generally 12 months, but are often paid off much sooner, and they can be arranged incredibly quickly, unlike a traditional mortgage.
What can I use a bridging loan for?
Bridging loans are generally used when you want a short-term loan and you need your finance in place quickly.
The types of situations where a bridging loan may be used include: –
You are buying a home and the sale of your current home hasn’t yet gone through, for example because your sale has fallen through
You are buying a property that is not currently suitable for a mortgage, but you are planning to refurbish and apply for a traditional mortgage or resell it
You are buying a property at auction, and you need funds quickly. Find out more about auction finance.
You are buying land for development and want to cover costs
How much can I borrow?
You can usually borrow up to 75% of the property value for bridging finance, however this is the figure for the gross loan, i.e. with any applicable lender fees and interest added. The net value of the loan will be less. At Simply Specialist Lending we deal with loans of amounts between £25k and £20million.
How high are bridging loan interest rates?
Bridging loans do tend to have a higher interest rate than those on traditional mortgages with interest calculated on a daily basis and APRs ranging between about 0.5% and 1% Monthly depending on the product. However, the term of the loan is much shorter than a traditional mortgage which explains the higher rates. Simply Specialist Lending brokers can help you compare rates and options.
Types of bridging loan interest
There are 3 kinds of interest that may be applied to a bridging loan
Serviced interest – This is paid monthly and is not added to the loan. This tends to be the least popular type, as most borrowers prefer to pay back the full amount borrowed, plus interest, at the end of the loan term. This ensures that during the loan term expenses are kept to minimum, very helpful if you are spending large sums on refurbishment.
Rolled up interest – Rather than paying monthly interest, payment is deferred. Interest is still added to the loan in the usual way but isn’t paid until the date agreed – usually the end of the term.
Retained interest – The lender calculates the estimated interest for the loan and adds this to the amount borrowed. This is again generally paid at the end of the term
How much does a bridging loan cost?
In addition to interest charges, you will also need to pay a lender arrangement fee, as well as any valuation and legal costs (sometimes you may have to pay the lenders legal costs as well). Fees vary from lender to lender, but Simply Specialist Lending will always ensure that you understand how much the loan will cost before you agree to anything.
What is a bridging loan exit?
When you take out a bridging loan you put in place a plan to repay the amount borrowed. This is the exit and lets the lender know how you will repay the loan. The strength of your exit strategy can impact how likely you are to be accepted for a bridging loan. Showing you have a strong exit can also make the process quicker and give you access to more flexible terms. Simply Specialist Lending can source not only your bridging loan, but also your exit product. This sets us apart from many other brokers.
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Why use Simply Specialist Lending for your Bridging Loan?
Simply Specialist Lending provides an end-to-end service that includes access to lenders many other brokers do not have, as well as an in-house underwriting service when appropriate. Our years of experience mean that we understand why speed is of the essence when it comes to bridging loans. We’ll compare bridging loans for you, making sure you get the best deal for your circumstances.
We are authorised and regulated by the Financial Conduct Authority (FCA) for your peace of mind, and our brokers are CeMAP qualified.
Call 01245 904266 For A Free Quote
Lines Open: Mon-Fri 9am-10pm and Sat/Sun 9am-5pm. Alternatively request a call back at a time convenient to you.
It’s quick & easy. No credit check.