What is a Bridging Loan?
What is a Bridging Loan?
A bridging loan is a short-term loan that is usually between 6-12 months in length, that is used to ‘bridge’ the gap until further funds have been made available, usually by way of a remortgage or sale of the property. It is sometimes known as bridging finance.
Why use a Bridging Loan?
A key factor for bridging loans becoming increasingly common in the property industry is because of the fast turnaround time.
Whereas a traditional method of funding could take months to complete from start to finish, bridging loans often get turned around in as little as one week after the lender has issued the offer and legal pack.
Examples of common bridging loan scenarios include:
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Securing the purchase of a property as a matter of urgency due to tight deadlines e.g. auction purchases
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Using short-term bridging funds to buy a property before your other property has sold
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Consolidating existing debts
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Carrying out refurbishment before refinancing under a conventional mortgage.
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Dylan Mann, Solicitor, Commercial Property Team
Lawson-West Solicitors, Leicester
The Importance of Deadlines
When dealing with bridging loans, there are often tight deadlines and urgency required from all parties involved, including the solicitors.
Our Commercial Team is based in both our Leicester Office and our Market Harborough Office and deals with a variety of bridging lenders, meaning that they will be able to assist you with the transaction in the most efficient manner possible.
If you require the services of a solicitor to find out more about a bridging loan, get in contact with our Commercial Team today.
