What Property Can Be Used as Security for Bridging Loans?

Bridging loans can be a great option for a multitude of quick release property-based loans for both commercial and personal use. This includes, residential, semi-commercial, commercial and land opening options.

Buying Properties

Bridging loans are a perfect solution for buying properties for all purposes in relation to commercial, trading and investment. One of the popular reasons people opt for a bridging loan is to set up a buy to let property or even a chain of properties to be rented out to build a business that generates reoccurring revenue.

Another great use for bridging loans is using the funds to complete a property purchase at the right time in the market to benefit from the most competitive price possible.

Auctions are also a very popular use for bridging loans which in turn could open opportunities that would otherwise be unavailable.

Other areas that Property can be utilised against Bridging Finance are: –

 

Properties to buy

  • A new residential property, commercial property, investment or trading property
  • Buy-to-let purchases
  • Quick completion of a property purchase to benefit from a discounted price
  • Auction purchases with pre-auction bidding facilities agreed

Properties to build and renovate

  • Housing developments
  • Barn conversions
  • Refurbishment projects to sell on for profit
  • Building your own home

Properties where funds need to be raised quickly

  • Un-mortgageable properties
  • Buying before selling
  • A short-term solution for a cash flow problem

Other Uses

Bridging loans are very versatile and have a range of applications. The creative use of a bridging loan means that projects that would otherwise never get approval from conventional financial providers become available. This could include barn conversions, housing developments, refurbishments and building your home.

Owner of An Un-Mortgageable Property

Properties that have failed to meet mortgage requirements, properties bought before selling current properties and a solution for cash flow issues in a short term format.

Some properties simply will not pass the regulations of conventional financial lending facilities.

Bridging loans are utilised by investors that are interested in properties that need renovations and corrective work put in place to make them eligible for standard mortgage requirements.

Some of the most common reasons for this arrangement include properties with no bathroom, kitchen or unconventional builds.

Investors are particularly interested in these properties as the renovations increase the value and before work begins secured long-term finance allows for letting or selling for a profit.

Considerations in these circumstances will depend on the investors experience with the property compared to their current portfolio. Investors use lenders current properties as they can leverage equity on current properties to meet the value of the bridging loan as they require to allocate funds to upgrade another property.