By their very nature, short term bridging loans UK are specialist finance products that enable an applicant to raise large sums of money quickly when, for instance, they cannot access a traditional mortgage product.
It must be said, that opting to use a bridging loan should be considered carefully and the pros and cons appreciated – there’s lots of help and advice available for those who are interested in learning more, and details will be given at the end of this article.
The first thing to understand is that a bridging loan can be used for a range of purposes including buying and refurbishing houses, shops, offices and buy to let properties.
Often, those wanting short-term finance are working to a schedule and bridging finance firms are geared up to turning around an application quickly and releasing funds, often in just two or three days.
Bridging loans UK are popular
Along with these flexible and quick turnaround times, bridging loans UK are popular because they appeal to those who may not be able to access conventional loans or mortgages.
In addition to buying and refurbishing property, they can also be used to buy stock or inject cash flow into a business.
Indeed, for those interested in bridging finance, then they should take a closer look at using a bridging loan calculator which will determine the bridging finance rates that will apply and whether the applicant can afford to take such a loan on.
The bridging loan calculator
It should also be appreciated that the bridging loan calculator does not have one rate of interest since the loan is used for differing purposes and the borrower will have a variety of circumstances so the interest rate will reflect these.
In addition, there may be broker and lender fees to pay on top of the interest rate, which are generally slightly higher than those for a traditional bank, and some lenders may also have exit fees to charge.
It should also be appreciated that for those who don’t have an exit strategy, that’s a term used to explain whether the borrower knows when they will repay the money, then they will be applying for an open bridging loan. These loans often have slightly higher interest rates than those for closed bridging loans.
Closed bridging loan
A closed bridging loan is for an applicant who knows when and how they will repay the bridging loan.
Bridging loans are also popular because the lending criteria is different from a high street bank, for instance, but they may not be for everyone.
For those who are interested in short term bridging loans UK then there’s a team of experienced advisers at The Bridge Crowd who can answer questions about the products available and the purposes they can be used for.