When Would Someone Need A Bridging Loan?

The demand for Bridging Loans has skyrocketed recently due to ever tightening financial institution regulations and policies. Individuals and businesses are taking advantage of the benefits of a Bridging Loan due to the flexibility and a unique approach to meeting needs that are not available anywhere else. This is especially important in a fast-moving market where a quick exchange is required so that property deals can be secured, put in place solutions for times of financial uncertainty which otherwise would be unavailable.

Common Uses for a Bridging Loan

Today, there are many uses for Bridging Loans. Traditionally, they were used to secure new properties whilst current properties are sold.

The Main Reasons for Property Owners to Use a Residential Bridging Loan

 

A Quick Time Limited Offer

Most use bridging loans to secure a new property at the best price or simply secure the home they want before they sell their current property.

A Fast Solution to Buyers Dropping Out

Homeowners can often miss out on opportunities due to a break in the chain of property buyers. Bridging loans can provide the missing link so that the full potential of the deal can be achieved or prevent the deal from being killed entirely.

A New Home Build

People who have a vision for their perfect home build and need financing for property and in some cases the land for their dream location they envision for their new home to be located. In this case a standard mortgage is not required, and bridging loan is much more suitable for their circumstances as they can move quickly without relying on over bearing mortgage lenders.

Property Conversions – Barns and Other Properties

Some people prefer the peaceful landscapes and fresh air of the countryside. Others, including property developers convert such properties to make a good return on their investment. This is a perfect application for bridging loans.

Auctions

Auctions move fast and the property you want can slip through your fingers if you do not have the capital to support your down payment, usually presented as a percentage of the value. Bridging loans are one of the fastest ways to secure the upfront payment required so you can invest in the property you want at the time it is available.

Get Funds Quickly

Markets can fluctuate and be volatile and change quickly. Having access to quick cash means you can act and invest at the best possible time to maximise your investment.

 

How Businesses Take Advantage of Commercial Bridging Loans

Access Capital – Fast

Businesses can secure loans against existing assets to raise the money for new ventures, take advantage of time limited opportunities in their sector or expand their current businesses. This can be vital in the expansion and growth of a business that needs to act within a given time frame.

Overdue Taxes

Many businesses use this type of loan to settle taxes quickly allowing them to move forward and continue to grow their business without the added pressure of tax liabilities

Business Requirements That Need Immediate Solutions

For businesses bridging loans are used in all kinds of capacities to solve problems where there is a temporary cash flow problem, or a new project has left them in a tight spot due to tight deadlines. This is another instance where access to quick cash can bolster the business providing the funds needed to carry them through until they have stabilised.