Bridging loans are known to be a relatively fast and flexible way to obtain finance. At Accelerated Finance we have access to over 50 lenders within the specialist finance market and understand what are the most important factors to consider when presenting a case.
In this Article, We Will Cover The Following Topics:
How Quickly Can I Get A Bridging Loan?
Depending on various factors, a bridging loan can take anything from 72 hours to a couple of weeks to complete. It’s not the quickest type of finance to get approved due to its complexity, but lenders are typically expert and very agile in getting the information they need.
What Are The Ways You Can Speed Up Your Bridging Loan Application?
In some cases, it’s just down to the particular lender’s own practices and resources but there are often external factors which contribute to.
The credit rating of the borrower is just one of the aspects which is considered. The better your credit rating is, the easier you are likely to find it to qualify for a bridging loan. However, other aspects are equally as important such as what your exit strategy is and the strength of the asset you want to borrow against. How much cash you are contributing to the project from your own pocket will also be taken into account.
If the lender can see that you have a good credit rating, the asset is valuable and secure and your plans to clear the bridging loan are strong, you could have the money in your account very quickly.
What Impacts the Speed in the Bridging Loan Process
Each bridging loan is bespoke and lenders assess each application depending on a number of factors including:
How strong the exit strategy is
The type of bridging loan
Experience within the market
Credit Scoring
Deposit amount
The valuation of the property. If there are any risks to the property that are identified
Exit Strategies For Bridging Loans
The exit strategy is arguably considered the most important factor for a bridging lender. i.e how will you repay back the loan once the term finishes? Common propositions are either refinancing to a longer-term solution or selling the property.
With a suitable exit plan you will have the ability to achieve more competitive rates.
Lenders will often consider several exit strategies, the main ones being:
Sale of the primary property
Sale of other investments
Refinance to a longer-term mortgage
Sale of a secondary property
Inheritance
Sale of shares
What Are Suitable Property Types That Can Be Financed Through Bridging Loans?
Bridging loans can be secured against different types of properties being residential, semi-commercial, commercial or land, and enabling options such as:
Properties to buy
Buy-to-Iet purchases
Quick completion of an investment property purchase to benefit from a discounted price
Auction purchases with pre-auction bidding facilities agreed
Properties to build and renovate
Housing developments
Barn conversions
Refurbishment projects to sell on for profit
Properties where funds need to be raised
Un-mortgageable properties
Buying before selling
A short term solution for a cash flow problem
Disclaimer
This article is intended to provide a general understanding of the topic. The contents should not be treated as advice. Accelerated Finance Limited only considers applications for commercial or investment properties. Accelerated Finance Limited is not regulated by the financial conduct authority and only provides unregulated loans via our network of lenders. Your property is at risk if you fail to make payments on a Mortgage Contract. Please note that Accelerated Finance Limited and its employees do not give financial advice or recommendations on any product.
