You want to buy a residential or commercial property or you are a project developer and need to continue on the construction work, but you have a shortage of funds for a prompt buying of the property. You wish someone had lent money at the nick of the time. Well bridging loans are meant especially for the purpose of providing instant financial support for buying a property or for continual of the ongoing works.
Bridging loans are short term loans. Bridging loans are a financial arrangement till the time the borrower is able to sell old property at desired price or is able to have money from other sources. Being short term loans, bridging loans come at very high interest rate. But a relief for the borrower in paying back the loan is that he pays only interest till he is finally able to clear the principal amount in one go. This means the loan is never a burden on the borrower and principal amount can be conveniently returned back.
Bridging loans are approved against the borrower’s residential, commercial or semi commercial property. Even if there is mortgage in your property, you can apply for bridging loans as lender offer a second charge bridging loans. The loan amount approved depends on lot of factor like equity in collateral, financial standing and good credit history of the borrower. Lenders usually approve anywhere from £25000 to £1000000 as bridging loans.
People with arrears, payment defaults, CCJ’s should feel free for applying to bridging loan providers. With the security in place, lenders can approve the loan without incurring risks. But the property placed as collateral may be repossessed by the lender in case of non payment of the loan. There are numerous bridging loan providers in the market each having attractive package. For a beneficial deal, compare interest rate and condition and see if the lender has experience in providing loan for your kind of needs.