100% Bridging Loans
If you require substantial funding quickly but lack readily available cash, a 100% Bridging Loan might be the solution.
Secure a quick bridging loan offer with InvestorBroker by your side.
Bridging finance provides a rapid way to access funds, though it often involves high interest rates and short repayment periods. Connect with InvestorBroker first, and we’ll assist you in finding top bridging loan providers offering competitive rates and terms tailored to your needs.
Bridging finance is an essential tool for property investors and businesses to address short-term funding gaps and secure quick access to capital. However, there is a notable distinction between standard bridging loans and 100% bridging finance.
InvestorBroker can assist you in finding better deals on both standard bridging loans and 100% arrangements—but it’s important to first understand the differences. Let’s delve into what 100% bridging finance entails and why it might suit your needs.
What is Bridge Financing?
A business bridging loan is a short-term financing solution secured against residential or commercial property. These loans can be used to purchase the property itself or fund other business objectives. The term “bridge” refers to their purpose: covering a short-term funding gap until longer-term financing is in place.
Due to the higher interest rates associated with bridging loans, they are designed for quick repayment, typically through the sale of the property or by transitioning to a long-term financial product like a commercial mortgage. These loans generally cover up to 70% of the property’s value, requiring borrowers to provide at least 30% as a deposit.
However, under certain conditions, 100% bridging loans can be arranged if additional assets are available.
What is a 100% Bridging Loan?
A 100% bridging loan is a specific type of financing for situations where no cash deposit is available for a purchase. Despite the name, these loans typically allow borrowing up to 70-75% of the property’s open market value. To achieve 100% financing, borrowers must either offer another property or asset as additional security or, in some cases, purchase the property at a discounted price.
For example, if you plan to buy a property for £50,000 for renovation and resale but lack a cash deposit, you could use other assets to secure the loan. Alternatively, if you want to purchase a portfolio worth £1 million at a market discount of £700,000, a 100% bridging loan could enable this.
Although commonly used for property transactions, there are no restrictions on how bridging loan funds may be utilized. If urgent financing is needed, a 100% bridging loan secured against property you own could be the ideal solution.
Fast Access to Bridging Loans
Bridging loans are designed for urgent needs or time-sensitive opportunities. These loans can often be arranged within hours, with funds disbursed in as little as 72 hours under certain conditions.
Bridging Finance Rates: What Do They Cost?
Short-term financing is generally more expensive than long-term loans, and bridging finance is no exception. While the interest rates and fees can seem high, the short-term nature of these loans often mitigates their overall impact on long-term costs.
Interest rates typically range from 0.7% to 1.5% per month, with higher rates for more complex arrangements. Additional costs may include an arrangement fee of 1-2% and, in some cases, an exit fee. Other expenses, such as surveyor and legal fees, should also be factored into the overall cost. Exceeding the loan term can result in significant penalty fees.
Some repayment plans allow interest and fees to be rolled into a single payment at the loan’s conclusion. Often, bridging loans are repaid using longer-term products like commercial mortgages.
Why Choose InvestorBroker for Your Bridging Arrangements?
Even small differences in rates and fees can greatly affect the overall cost of finance, and comparing lenders’ offers can be challenging without expertise. InvestorBroker offers essential support to navigate this complexity.
Our team of experts will analyze your needs and use our extensive network to identify the most competitive solution for you. By leveraging first and second charge securitization, we can help you secure 100% financing for your property, including associated costs and fees, often at market-leading rates.
InvestorBroker understands the bridging finance landscape and can connect you with lenders offering tailored solutions. Our knowledge ensures you get the funding you need while saving money and avoiding costly mistakes.
Bridging finance is a short-term tool, but we can assist in transitioning to the most competitive long-term funding options. Whether you’re seeking high-value bridging loans or exploring other solutions, we’re here to help.
