Plenty of financing options exist today, each one with its merits and demerits.
Bridging financing appears to have won over many hearts in recent times.
Many borrowers like its speed, informality and ability to break property chains in raising credit.
This credit is to purchase property or finance business.
This article will reveal seven unique reasons why you can safely take out bridging financing.
#1. Flee property chains
If you are a property developer or investor, bridging loans can provide the leverage to bypass traditional property chains that accompany a mortgage.
Using a bank can easily take six weeks after completing relevant paperwork.
To purchase a property within an attached time frame, bridging loans provide the chance to access funds shortly (2-3 weeks or less).
The biggie is the skipping of normal checks that a typical mortgage has.
#2. Rapid access to fast funding
Every property purchase is time-bound.
These are often hard deadlines.
How do you complete such time-sensitive transactions?
This can happen with auction finance, where you only have 28 days to provide outstanding funds for the property.
Many bridging lenders have a streamlined process with shorter application regimes.
They also engage in-house solicitors and recommend surveyors to value the property and make the transaction happen fast.
#3. They are mostly transparent
It is clear they charge superior fees compared to other lenders.
They are helping you reach your goal faster so no shame in that.
The indicative terms and loan agreement specify very clearly the loan amount, the loan duration and all rates involved.
The premise is that their loan helps you the borrower, either make money or save money.
This accounts for the flexibility and absence of early redemption penalties or exit fees.
#4. Absence of credit checks
Bridging lenders are non-status lenders, so they do not apply credit checking to assess eligibility.
In fact, anyone with a history of bankruptcy can always get a bridging loan.
If you can prove a history of success at repaying past loans and credit, that is proof enough of your creditworthiness.
A bridging loan differs from a standard personal loan in that you have property (a valuable asset) used as collateral. In fact, cross-collaterization is permitted in many cases.
Credit checks are replaced by monetary potential of property and your plans for it.
Finding affordable property with excellent growth potential will likely get your application considered.
#5. You can be self-employed
Sizeable finance and mortgage often eludes those who are self-employed. They are considered high-risk as their monthly income is barely guaranteed.
Bridging loans companies will gladly provide the loans the need once they fulfil the firm’s loan conditions.
#6. Leverage on high-growth opportunities
Because bridging finance makes loans available on relatively flexible terms at short notice, they enable you capitalise on high-return opportunities.
A developer can purchase homes and sell profitably once demand is sky-high.
Fast-growing businesses can use the loans to facilitate growth, the office or premises being used as collateral to obtain capital for operations.
Bridging provides flexible access to funds to leverage high growth and repay once in a position to do so
#7. Absence of upfront fees or exit fees
To get a project up and running while keeping an eye on cash flow, one can receive a drawdown with no upfront fees.
Standard exit fees and charges that apply to early repayment are waived by bridging lenders with transparency and flexibility.
In fact repaying early could net you an interest rate reduction since loan term is shorter than anticipated.
You can use this bridging loans calculator to know what you owe your bridge lender on an on-going basis…
Now that you are aware of how and why you can take a bridging loan, why not consider BridgingLoans.co.uk today? Many others like you have.