If you ask yourself – how to get a bridging loan – here’s the answer to all your indecisions. Bridging loans are frequently used to purchase auction properties, or to help fund new property purchases if minor delays are incurred. Companies and individuals can achieve up to 100% of their desired commercial loan, but the costs can be prohibitive. If you decide to take out a bridging loan facility be sure to check both the interest rate and the lender arrangement fees as these can be quite significant.
Commercial bridging loans are short term loans where either a first or second charge against a property is used as security for the money. Bridging loan facilities can be used to raise large sums of money to take advantage of opportunities as they arise such as auction purchases, property improvement and development for resale. Alternatively they can be used as a means of obviating a short term financial issue. There are a number of different instruments offered by bridging loan companies, such as closed commercial bridging loans, open commercial bridging loans, non-status bridging loans, self-certification bridging loans. The key is to look carefully at each offering and compare bridging loan to bridging loan.
Bridging loan companies will offer terms over several months though under extreme circumstances these can be extended out to a year and beyond. During the period of the loan there may be no requirement to make monthly payments and all interest costs will be rolled up to complete at the end of the arranged term. Commercial bridging loans are available regardless of previous credit history.
Getting a bridging loan – how much can you borrow, and at what cost?
It’s obvious that each lender will take a various look at risk so it’s important to compare bridging loan costs. Take a careful look at interest charges to be applied which typically are 3 to 6 percent above base rate. Remember also to be aware of any arrangement fees set, that can be chargeable at as much as 1 percent per month of loan sometimes. You will have to pay valuation survey fee so take a careful look at the offer you get from Bridging Loan Company as it should be affordable.
How long does it take to get a bridging loan?
It requires some time for completing and processing the application, getting a survey of the property and looking through bridging loan finance information. However you can get lending decision in hours and money in few days.