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Bridging Loans - Facts
Short term bridging loans provide a fast and flexible solution for a specific need.
- Often associated with residential and commercial property purchase, bridging loans can also be used to plug a funding gap pending receipt of monies awaited or to assist with a temporary cash flow problem.
- More expensive than other forms of funding and hence best utilised over short periods in the absence of availability of more appropriate funding products.
- Usually non status and providing there is a “clear exit” for the lender, the credit assessment of bridging finance applications is generally less rigorous than for other forms of finance.
Features of bridging loans
- Can be arranged quickly – in as little as 24 hours if necessary
- Flexible terms – from one month upwards
- Interest can be rolled up into the loan
- Interest rates from 1% per month. An arrangement fee is usually also payable
- First and second mortgages