Bridging loans is a type of short-term funding solution that is often used to fund you for a period of time whilst allowing you to either refinance to longer-term debt or sell a property. It generally has a slightly higher interest rate than conventional mortgages, reflecting the lender’s risk due to the uncertainty of the existing property’s pending sale.
Typically short-term funding solutions are offered for between 1-18 months, with the loan repayable in full at the end of the term. Unlike other forms of borrowing the monthly interest is often rolled into the loan, so there are no repayments to make during the term of the loan.
Bridging loans are usually desired when a temporary cash-flow dilemma arises, e.g. having to wait to sell an existing property, in order to cover the equity required to buy a new one. These loans are typically made on an interest-only basis for terms up to 12 months.
Features about bridging loans include:
When bridging finance is required, Global Capital Commercial (GCC) helps borrowers understand the key considerations and challenges while providing the confidence and the funds needed to ensure the best result.
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