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Bridging finance is a form of short-term borrowing that provides immediate access to funds, typically secured against property assets. It is commonly used to bridge the gap between the purchase of a property and the sale of an existing property or securing long-term financing, hence the name “bridging” finance.
Bridging finance may be the right solution for you in many circumstances, these include If you are purchasing a property that is not current habitable or lettable, you have a short completion deadline, such as an auction purchase, or it could be that you are waiting for another property to sell and need to complete another purchase before these funds are available.
One of the key advantages of bridging finance is its speed and flexibility. Traditional mortgage applications can be lengthy and may not align with tight property purchase timelines. Bridging loans can be arranged quickly, allowing you to seize time-sensitive investment opportunities.
Bridging finance can be an effective solution when faced with a property chain break. If you are in the process of selling a property but need funds to complete the purchase of a new one, a bridging loan can provide the necessary finance to proceed without delays.
Many property investors participate in auctions to acquire properties at competitive prices. Bridging finance offers a viable option to secure funds within auction timeframes, as traditional mortgages often cannot be arranged quickly enough.
Bridging loan finance can be used to finance property refurbishment projects, allowing investors to add value to the property before refinancing or selling it.
Bridging loans typically have higher interest rates compared to traditional mortgages due to their short-term nature and speed of execution. It is crucial to carefully consider the interest rates, fees, and associated costs when evaluating the viability of bridging finance for your investment strategy.
Bridging finance is a short-term solution, usually ranging from a few months to a year. Having a well-defined exit strategy is vital to repay the loan within the agreed term. This could involve refinancing with a long-term mortgage, selling the property, or using other available funds.
Bridging lenders assess the loan-to-value ratio of the property to determine the loan amount they are willing to offer. Typically, bridging loans can cover up to 75% of the property’s value, but this can vary among lenders. It is essential to have a clear understanding of the LTV requirements and ensure you have the necessary funds to cover the remaining portion of the property purchase.
The perfect opportunity arose for our clients to purchase their dream property at auction. However, yet to sell their existing home, we were able to complete on a bridging loan to allow them to complete the purchase of the new property within the auction timescales, without the pressure of them having to sell their own homes.
First charge regulated mortgages – We will provide advice and make a recommendation for you after we have assessed your needs and circumstances.
Second charge regulated mortgages. We will provide advice and make a recommendation for you after we have assessed your needs and circumstances.
BTL & CBTL unregulated mortgages. We will provide advice and make a recommendation for you after we have assessed your needs and circumstances.
Please note that our recommendations with respect to Buy to Let are restricted to helping you arrange a suitable mortgage. We will not advise you about whether or not the property you plan to buy and let out to tenants, will turn out to be a sound investment.
Insurance – We will provide advice and make a personal recommendation for you after we have assessed your need sand circumstances. We provide an intermediary service and act on your behalf.
Mortgages – We are not limited in the range of mortgages we will consider and offer advice on for you with respect to first and second charge regulated mortgage contracts for both business and non-business purposes, as well as unregulated BTL and CBTL mortgage contracts. In circumstances where you are looking to increase existing borrowing, the following options, on which we may not be able to advise, may be more appropriate: A further advance from your existing lender. An unsecured loan.
Insurance – We recommend products based on a fair and personal analysis for term assurance, critical illness, income protection, family income and non-profit whole of life
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The guidance and/or advice contained within the website is subject to the UK regulatory regime and is therefore primarily targeted at customers in the UK.
You may have to pay an early repayment charge to your existing lender if you remortgage.
The Financial Conduct Authority does not regulate some aspects of buy to let mortgages.
Your home or property may be repossessed if you do not keep up repayments on your mortgage.
Your Mortgage Consultants Limited is registered in England and Wales. No. 14109222. Registered Office: 41-43 Market Place, Chippenham, Wiltshire, SN15 3HR.
Your Mortgage Consultants Limited is an Appointed Representative of Cornerstone Finance Group Ltd, which is authorised and regulated by the Financial Conduct Authority.
Cornerstone Finance Group Ltd is registered in England & Wales. No. 08458702. Registered Office: Unit E Copse Walk, Pontprennau, Cardiff, Wales, CF23 8RB.
Your Mortgage Consultants Limited (No. 979284) and Cornerstone Finance Group Ltd (No. 767202) are entered on the Financial Services Register at https://register.fca.org.uk/
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