Bridging loans are a great way to finance future expenses when you do not have the money on hand at the time to pay for them. Understanding what a bridge bridging loan is and how they work is important, which is why you want to work with an expert bridging loan broker to get the money that you need. They will be able to explain bridging finance to you and help you make a good decision regarding your future.
Before agreeing to sign up for a bridge loan, it’s important that you understand what they are. They are mostly used to buy property, and are secured loans that are used for just a few months while the purchase is completed. Bridging loans for house purchase will allow you to buy the home you want even if you do not have the cash on hand at the time. Rates on short term bridging loans tend to be higher than other types of mortgages.
We Offer Two Main Types of Bridging Finance
Regulated Bridging Loans
Residential bridging loans are short-term borrowing products that are typically secured against a client’s primary residence or main dwelling. They are useful for covering the cost of home improvements, debt consolidation or for funding the purchase of a new property whilst awaiting the outcome of the sale of your original home. If you want to raise funds quickly and you have sufficient equity left over in your property, whether it is mortgaged or owned outright, a short-term bridging loan could be the solution.
With low borrowing rates, on loans that are secured against 50% or less of the total worth of your primary residence, these competitive bridge loan products are highly affordable and exceptionally convenient. Borrowing terms are available from just two weeks going up to 24 months depending on your requirements.
Unlike most other secured borrowing products our FCA approved and regulated bridging loans are repaid in full at the end of the term with the associated fees and costs added to the net value of the bridging loan.
Unregulated Bridging Loans
Unregulated bridging loans are useful in situations where the borrower intends to use a non-residential real estate asset as security for funding. If a bridging loan is secured against commercial property such as land, development plot, warehouse or a building that is not fit for habitation, then the borrowing rules are more relaxed. As an experienced whole of market finance broker we provide both regulated and unregulated bridging loans.
If you need a short-term loan for debt consolidation, to purchase a new property for your business or you need to raise funds to acquire an auction property, unregulated bridging loans from Donkey Finance will serve as a competitive borrowing option with flexible repayment terms. Simply contact the team and we will do our utmost to provide the most sensible loan at a competitive rate. Our commitment to client satisfaction is quite simply unrivalled, regardless of borrowing context.
Frequently Asked Questions
Many people have questions about bridge loans, how they can help, and what to expect. Get the answers that you need here so you can make a great decision.
Bridging loans start at £10,000 and upwards.
We can get you an agreement in principle within 24/48 hours.
Depending on the level of adverse credit, you will still be able to get a bridging loan secured against a property.
Depending on what the arrears are, lenders may take a view and offer a higher rate. Again with CCJ's certain lenders will take a view depending on when the CCJ was issued and the amount it was issued for. Higher rates may apply.
Depending on the circumstances, the lender may ask one to start servicing the loan or If there has been a chain break and a new buyer has been found the lender may give you a few months. It's all dependant on the situation and the lenders policy in such situations.
Second-charge bridging loans are a specialist type of secured loan, where a property that still has outstanding mortgage payments is used as collateral. As with a typical bridge loan, the full balance is usually paid back within a few months in one lump sum.
Ideal for raising funds for property improvements, a second-charge bridging loan is often accessible with no credit checks required and no proof of income. Popular when used for second-charge bridging loans including property extensions, loft conversions and building/room repurposing.
After completion of the project, there’s usually the option of refinancing onto a secured loan, reducing the rate of interest. However, where major works are already taking place on a property, a bridge loan lender may be reluctant to accept it as collateral.
Property purchases prior to selling one's current home
Rejections due to adverse credit or low income
Properties where a mortgage is not possible
Renovation and conversion projects
New build projects
Land purchases with or without planning permission secured against a property
2nd charge purchases
Everyone is concerned about how much money they will be able to borrow with a bridge loan, and the amount that you can borrow depends on the value of your property and what kind of property it is. Once you decide that you want a bridge loan, a lender will evaluate your property and determine how much they are willing to lend you.
You will most likely want the money from your bridge loan right away so that you can buy your dream home, but you will have to wait a few weeks. While it only takes up to two days to find out if you have been approved, the formal offer will take around two weeks and you won’t get the funds until two to four weeks after submitting your application.
While most bridge loans do not have a penalty for being paid off early, there are some lenders who may charge a fee for this. It’s important to check your paperwork for any information on this matter before signing if you are planning on paying off your loan before it is due.
The rate that you qualify for with your bridging loan will be a huge factor in determining if you are able to afford your payments. Unfortunately, it’s impossible to quote a guaranteed rate without considering what the market rates are, what the loan to value of the property ratio is, how good of a credit score you have, and other factors.
Bridging loans are not meant to be long term, and while they can be arranged for lengths as long as one year, they typically have a term of just seven months. If you are going to need the money for longer, you will have to come to an agreement with the lender.
While your credit is taken into consideration and may play a role in the interest rate you qualify for, bridging loans are usually based more on the loan to value and condition of the property that is going to be held as collateral. As long as the property is in great condition and there is enough equity for a great loan to value, credit isn’t a huge issue.
How to Get a Fast Bridge Loan
If you think that working with bridging finance brokers is the best way to finance the purchase of your new home, then you will want to have all of your information ready before setting up a meeting so that you are prepared. Getting bridging loans UK takes the same information as a traditional mortgage does, so you will need proof of income, employment, information about all of your debts, and identifying information before a bridging loan broker will be able to help you.
If you currently own your home and are interested in selling it and buying the home of your dreams, your best bet is to take out a bridge loan, as this will make it possible to get the funds you need in order to make a purchase before you close on the sale of your home. Working with an expert in bridging finance solutions will ensure that the process goes smoothly and that you get the help and money that you need.
Compare Bridging Loan Rates
Donkey Finance are a whole of market bridging loan broker having access to the best bridging ﬁnance deals. We compare bridging loan rates from dozens of independent ﬁnancial specialists and mainstream lenders, ensuring every borrower is able to secure accessible funding. We are quick to compare bridging loan rates and borrowing costs, sourcing an affordable bridging loan for your requirement and budget.
With no up-front fees and no preliminary credit checks we provide streamlined access to the UK's most dynamic ﬁnancial packages. Bridge loan funding is available from £10,000 with no upper-limit and can be used for most scenarios. Whether you need a debt consolidation loan, last-minute shortfalls to planned purchases or property renovation, our bridging loan comparison service will source the best funding available.
Call today: 0116 402 7983 and let the experts at Donkey Finance handle all the complex formalities on your behalf.