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Commercial & Specialist Finance Solutions
At More Commercial, we make it simple to access specialist mortgage solutions that move your plans forward from commercial property purchases to bridging loans and development finance.
Cutting the Cost of Bridging Finance
We will do our best to find you the most suitablepossible bridging terms
Bridging Finance
What is a bridging loan?
A bridging loan is a short-term finance facility up to 12 months, used to bridge the money gap when buying a new home before selling the current home. They range from £50,000 to £500 million and are secured against property in good or poor condition.
When compared to mortgages they are much quicker to arrange and not so dependent on income or credit history.
These days, due to their flexibility over other finance facilities, bridging loans are used to fund property refurbishment and restoration projects. Due to being fast to arrange, they are also popular for buying properties at auctions, where speed is usually essential.
They are sometimes referred to as swing loans or gap finance.
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Fast to arrange
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Property restoration
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Poor credit histor
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How do I get a bridging loan?
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Being completely independent allows us access to the most competitive loan plans.
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We are experts in the world of bridging loans and always up to date with regards to which lenders are currently offering the best deals.
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When it is possible to do so, we also further negotiate with the lenders for their best individual deals.
How does a bridging loan work?
A bridging loan uses the equity in a property as security for a secured borrowing facility. Unlike other secured loans and mortgages, a bridging loan can be set up quickly and can also make use of property that would normally be considered unsuitable security by many lenders. For example properties in a poor condition, or those without kitchens or bathrooms.
It is important to remember that bridging loans are a short term finance option, so should not be taken out over long periods. As a short term method of finance they have advantages over other funding methods because:
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Many facilities do not have exit or redemption fees.
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They can be set up quickly.
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Can make use of property that is in a poor state of repair and therefore unsuitable security for most lenders.
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Interest charges can be added into the bridge loan for the full term, or a set number of months, and paid when the loan is redeemed.
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Income proof and affordability calculations are not a limiting factor if interest is added to the facility.
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A Poor credit history is ignored by many bridging lenders.
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Less age restrictions.
The vast majority of bridging lenders are unregulated, meaning they are not authorised or regulated by the Financial Conduct Authority. They are still able to lend but are restricted to only being able to provide unregulated bridging loans.
The lenders who provide regulated bridging also provide unregulated facilities. Whether or not a bridging loan is regulated or un-regulated depends on who might be living at the property being offered as security. If it is the borrower, or a close member of their family, then the loan will need to be regulated.
In addition, if the borrower does not currently reside at the security property, but has plans to in the future, then this will also mean that the loan will have to be regulated.
Some lenders may insist that a loan is written on a regulated agreement if the borrower does not reside at the security property but has done in the past.