SHORT TERM BRIDGING LOANS UK
As the term describes, a bridge loan is a form of short-term interim funding that ‘bridges’ a gap in financing. This can take several different forms, but in the case of a classic Bridging Loan it forms part of a clearly defined agreement whereby the money is lent against a set of previously agreed-upon terms.
The most of important of these criteria is the duration of the loan, as it provides a liquidity solution before longer-term financing can be arranged and comes into effect. In Short-Term Bridging Finance, the so-called exit time – when the loan is due to be repaid – is set beforehand, and while flexibility can be negotiated with the lender, the emphasis is on shorter term periods.
These can usually vary between two weeks and two years, but in the case of Bridge Help we provide bridging finance to suit your personal requirements. After timing, the other important factor is how the loan will be repaid, and this can vary from the sale of a property or business to investment funds flowing into a new venture or a new long-term loan kicking in and clearing the bridging loan.
You may occasionally also come across alternative terms such as caveat or swing loans, but Bridging Loans or Bridging Finance are the most common terminology.
COST AND CONVENIENCE FACTORS
As a rule, lenders of Bridging Loans charge a higher interest rate to balance the higher degree of risk, as well as solid collateral and in some cases a lower loan-to-value ratio, but they are fast, convenient and require relatively little documentation. The principle is well-established in the United Kingdom and many countries around the world, and is commonly used in property development, among others.
Bridge Help is a specialist in this form of finance. Contact us now for more detailed information.