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Bridging Finance Residential
Loans
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Bridging finance for residential property provides temporary funding for use when the purchase of a new home and the sale of the old home are not synchronized. When you have a contract on your old home and you have purchased a new home, this loan allows you to complete the purchase.
This type of advance is available to those who are over 18 years of age and are a resident of the UK. The other requirements vary from lender to lender but are slightly more relaxed than typical traditional loans. This is because the bridging finance loan for residential property uses the actual real estate as security. This means that if you fail to pay the loan as promised, the bank or loan company could foreclose on the property.
The timeframe to get this type of advancement is typically very short. This allows the borrower to quickly receive the funds needed to proceed with the property purchase. The application and approval process generally takes only one to several days, with funding coming shortly thereafter. This is important because the funds are usually needed very quickly in order to keep the closing on time.
The amount of money that can be borrowed on a residential bridging financing is usually limited to less than 86% of the property value. The loan is secured by the property itself and the loan company gets most of its information from the mortgage. If a recent appraisal has not been done, the lending company will often demand one. This can slow the loan process down considerably, so it is always a good idea to have a new appraisal done with the purchase.
Bridging finance for residential property can also be done for other reasons. You may need money quickly to pay immediate bills or to take a holiday. This type of loan can be used for these purposes as well. Keep in mind that this type of loan offers a higher interest rate than other traditional loans. Also, the payback time is rather quick, so be sure that you will be able to pay the loan in full, in the timeframe. While extensions are possible, the penalties for extensions and late payments can be very high.
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of Use
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| Who's Suited |
- Purchasing
property at auction.
- Property refurbishment or conversion.
- Chain breaking mortgages.
- Homeowners who have been or about to be repossessed.
- Funds required within days not months.
- Short-term finance for business purposes.
- Commercial property purchase and refinance. |
| Features |
- 100% LTV
Available.
-Market leading rates from 0.75%.
-1st charge or second charge equity release. |
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