Bridging finance for homeowners

If you are considering using a Bridging Finance personal loan, it is always best to do some research before making a decision. It is best to get a personal loan from a reputable lender and make sure the interest rate you are getting is in line with your credit history. There are many lenders offering these loans, so finding the right one can be a daunting task.

what is a bridging loan ?

Bridging finance is used by home owners in 2 main ways;

  1. To help fund a house purchase – particularly if a sale chain has fallen through or you just can’t find a buyer quick enough and don’t want to lose that next perfect home.
  2. Many home owners use it to build property extensions, based on the future value of the home.  

Current mortgage lenders will value the home as it is, today,  they dont take account of the future value, whereas bridging loans will look at what the future value might be.

home extension loan

How bridging loans work

Essentially they follow the following main stages;

  1. Outline of proposed build / costs to build 
  2. ensure you have full planning permission for local authority
  3. Future value of property GDV  established
  4. loan to fit within 60% / 70% of overall finished value
  5. Apply for the finance
  6. Lender values property & appraises all planning details
  7. Loan offer issued
  8. build work commences
  9. build finished = refinance to main mortgage and repay the bridge loan


what about commercial / business bridging ?

Bridging finance is used to assist with the start up of new companies that need extra capital. The financial institution that provides this bridging finance is called a bridge financing company. It is imperative that you do your research on any bridging finance companies before committing to their services.

Use the Internet to learn about bridging finance and the ways to find it. The Internet will help you get in touch with companies that offer this type of financing. You can even use the Internet to conduct a company search to find out if there are companies offering bridging finance to those companies.

Once you find companies that you think might be able to provide this kind of financing, you will want to conduct online research on these companies. The purpose of conducting this online research is to find out if the company has a good reputation for providing quality bridging finance. The company needs to be able to pass an online credit bureau check and conduct background investigations to ensure that they are not involved in any other kinds of lending.

You may also want to make sure that the company offers a money back guarantee. This is very important when you are buying bridging finance. A company that is not going to give you a guarantee should be avoided. This ensures that you can get out of a financing contract if the company does not deliver.


Bridging loan with Bad credit

You can get bridging loans with bad credit, but you must be able to prove ho you will exit the finance,  eg a further mortgage, new secured loan or by selling the property.

Bridging loans are classed as non status, that means the lenders are not as hung up on historic ccjs, or even if you have a discharged IVA or Bankruptcy.

However they are not idiots and will look to make sure the project and you both make financial sense

Use credit bureaus to perform background research on the company you are considering purchasing bridging finance from. Credit bureaus help the consumer to gather information about how well the company has been performing for customers. They will also help you find out what kind of people are behind the company.

It is imperative that you go through a background investigation before you ever make a loan agreement with a company. Your credit report plays a role in whether or not you will be able to get a good rate for the loan you are looking to obtain.

The credit report that is generated when you apply for bridging finance will determine your credit rating. Bad credit can hold you back from getting a good rate on the loan. When you buy this type of loan, make sure that you purchase from a company that will help you fix your credit before any of the money is actually owed to them

How much can I borrow on a bridging loan?

Typically 60%  of the initial value straight away, with upto 60 – 70%  of the final value available as the build progresses.

You can choose from a range of options when it comes to funding for bridging loans. The most common method is to get a line of credit of a specific amount, such as five thousand dollars, which will be applied towards the initial deposit. If you do not have this amount, you can always borrow from other sources.

You can also opt to have a smaller amount borrowed at a higher interest rate. By doing this, you will be able to save money when the time comes to pay the loan off. This helps to keep the borrowing rate lower, helping to keep interest rates at a lower level.

One way that bridging companies are able to lower the rates that they charge for their loan is by using variable APR. Variable APR means that the lender can change the amount of the loan at any time during the term of the loan. This is referred to as “monthly closing”.

Borrowers who do not pay off the entire amount of the loan will be charged interest at a higher rate. Variable interest means that you are paying for the monthly closing rate that has already been set. Variable APR makes this a more expensive option and therefore, makes it more difficult to get the loan.

It is imperative that you compare rates and conditions between companies in order to make the best decision when buying bridging finance. Being informed will help you to be confident when asking for bridging finance and to get the best deal possible.

What is Bridging Finance? It is the combination of borrowing and cash advances, usually on a personal loan, secured or unsecured. It is often used in the purchase of a new home to fund all or part of the down payment of a home.

Borrowing and advances can be used for just about any purpose, be it buying a new house, refinancing your mortgage, consolidating debt, to pay for an unexpected medical expense, or even to pay for business travel. In general, most types of Bridging Finance are secured loans. Typically they are secured against a property and therefore the amount of interest you pay is a fixed amount for a set period of time. The property in which you obtain Bridging Finance will not be affected by the loan.

Mortgage Bridge loans have a number of features. Usually they offer refinancing or re-borrowing options. They may also offer refinancing at lower rates, extending the period of time you have your home for much longer.

A mortgage bridge is just that – a loan that allows you to continue to use your existing mortgage while taking advantage of a lower rate. In some cases the interest rates are so low that you pay no more than what your existing mortgage would pay if you refinance, and if the house you buy will be enough for your family’s needs.

Mortgage Bridge loans work in many ways. Here is a basic description of each.

Equity loan means borrowing money from the equity you have built up over time. Equity means the total value of your home minus the mortgage balance, usually at least five percent of the appraised value. Equity loans are good if you have equity in your home, because you can borrow money with less than five percent of your home equity. It also allows you to take advantage of a lower rate. Equity loans are frequently used in cases where there is not enough equity for a traditional mortgage.

Cash advance involves a part of your bank account being used to repay your Bridging Finance with cash advance financing. You may choose the rate of interest you borrow, depending on your personal circumstances. Cash advance loans usually have higher rates than conventional mortgages because the lender takes more of a risk in lending money that has not been guaranteed.

In addition to providing your personal finances with a personal mortgage, Bridging Finance also offers the opportunity to improve your credit score. However, you should not expect instant credit. In fact, a Bridging Finance history is usually less than three years in length, meaning it will take several years before you see any improvement on your credit report.

If you are going to use a Bridging Finance personal loan, then the first thing you will need to do is apply. For this, you will require a bank account, a personal and a credit reference report, and a job or income history. A Bridging Finance application can take several weeks to complete.

When you complete your Bridging Finance application and get approved, you will be given a copy of your approved loan. Once the funds are in your account, you can immediately pay the lender or arrange for your account to be wired. In either case, you will receive the funds in the form of a direct deposit, so you can use them immediately.

Bridging Finance loans can be a great way to avoid making large loans that can become very difficult to repay, but they are not for those with poor credit histories. Even if you are delinquent on a mortgage, credit card or car loan, you can still get a Bridging Finance loan because it does not count as one of your personal assets.

If you are considering using a Bridging Finance personal loan, it is always best to do some research before making a decision. It is best to get a personal loan from a reputable lender and make sure the interest rate you are getting is in line with your credit history. There are many lenders offering these loans, so finding the right one can be a daunting task.