Why you might opt for bridging finance

Have you ever considered bridging finance?

Whether over a period of days or a year, property investors, developers and small business owners choose bridging finance as a short-term solution to an investment opportunity.

The interest rates of bridging finance may be a bit more expensive than regular commercial lending, but that doesn’t stop them being very popular with investors – they offer a great solution in many situations. Here’s why you might opt for bridging finance:

When you need money quick

When a property catches the eye, a good investor knows that it’s essential to act fast – or someone else could get in on the deal. Arranging bridging finance means that you could enjoy rapid funds to secure a deal quickly, sometimes within the space of 48 hours.

When you’re buying at an auction

Many property developers find that the best place to find a bargain is at auction – but you need to pay for your purchase in a space of just 28 days. Because it can often be hard to arrange a commercial mortgage in four weeks, many investors find that bridging finance is a great way to plug the gap before more competitive funding can be arranged.

When lenders need convincing

You’ll know that being a successful businessperson is about taking risks and sometimes putting your money where your mouth is. But sometimes it can be tough to convince a bank or mortgage provider to do the same. That’s when many investors choose a bridging loan.

For example, perhaps you’ve spotted a run-down property and are convinced that you can turn it back into a successful, profit-making investment, but your lender doesn’t feel the same way. They tell you that they could offer you a commercial mortgage for the property, but it will need some work doing in order to secure it. So you arrange bridging finance to pay for the building and the renovations and then secure a mortgage once the work is done.

When a chain may collapse

Although bridging finance is often used by residential house buyers in order to prevent a chain collapse, property investors also know that it’s just as useful for them too when they need to buy a property but are yet to sell another. Bridging loans plugs the gap between paying for a property and a new income stream.

Whatever you need bridged finance for, at Pure Commercial Finance we will work with you to ensure that you enjoy a solution that suits you – from one-day plans to 3-year bridged finance policies.

Article By Ben Lloyd

July 5th, 2013

Ben is the Director and Co-Founder of the Pure Group and Managing Director of Pure Property Finance.

Following a career in Barclays, where Ben was in the real estate finance team for 8 years, he decided that the market needed a more forward-thinking type of commercial brokerage so founded Pure Commercial Finance (now Pure Property Finance), the first company within the Pure Group.

Ben has extensive experience across the real estate sector and has participated in over £2bn of real estate transactions during the course of his career.

Ben oversees the general strategy at Pure Group and works with the senior leadership team to drive the Group forward. Ben is also on the Executive Committee of FIBA.

See more articles by Ben

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