If you are in Birmingham or the West Midlands area, finding a bridging loan that meets all of your specific needs can be tricky.
At Bridging Options, we pride ourselves on connecting our Birmingham clients to a personalised bridging loan lender that meets all of your needs no matter how specific or general they may be.
Birmingham is an area brimming with entrepreneurship and property options to meet a wide range of needs and tastes. But you should never feel like you have to solicit mortgage lenders if your needs do not meet those long-term implications.
Bridging loans are great options to consider when it comes to the property purchasing process. This can be either commercial or residential. Allow us to tell you exactly how.
What is a bridging loan?
Whether you are in Birmingham or the outer areas of the scenic West Midlands, a bridging loan allows you to receive short-term financial solution options without long and locked-in mortgage rates.
A bridging loan is first and foremost, short-term finance. It is finance that you can use to buy a property, and typically within a few months, you would then sell or refinance the property in question to then pay the bridging loan back.
Bridging loans work as a stop-gap solution.
So why would you choose to use bridging finance? You likely think it is sensible to use a mortgage, and it certainly is for most property purchasers the first time around, but a temporary cash-flow problem is a natural part of life, and this is where bridging finance can make a property transaction much easier.
Bridging loans are perfect for properties that are not exactly mortgageable or indeed, for a situation where you may be looking to pull your cash back out or even refinance.
Mortgages are not designed for short-term loans, so if you want to flip a property, for example, mortgages are not designed for this or even property refurbishments since this is an example of short-term finance.
How do you get a bridging loan in Birmingham?
When you need a Birmingham bridging loan, finding an appointed representative and using a bridging loan calculator are the best first steps.
An authorised and regulated representative can find leading bridging loan deals for a property purchase that you may otherwise have not found, had you contacted lenders directly.
Representatives are regulated to offer both open bridging loans or debt secured closed bridging loans if needed.
You can read more about using a bridging finance calculator here.
Who can get a bridging loan?
Bridging loan options are available for virtually anyone needing a bridging loan. But there are some important key details to keep in mind.
You will need to have an existing home or some form of acceptable collateral in order to qualify. Lenders will need to ensure your investment can cover the potential costs of the loan if repayment cannot occur.
A strong and solid exit strategy is crucial, especially if you are seeking a new property purchase or you are going forward with purchasing an auction property.
Your credit score and history will be evaluated, but if you have adverse credit, this is not an automatic denial, it depends on the specific lender- at Bridging Options we can help you connect with lenders in this area.
Types of bridging finance available in Birmingham
The Financial Conduct Authority sets many different types of bridging loans for a range of options. Let’s take a look at each.
Commercial Bridging Loans Birmingham
A commercial bridging loan is a type of short term funding that can be used if a person wishes to secure funding for the purchase of commercial properties.
Commercial properties could be, but are not limited to, farming and agricultural properties, hotels, rental properties, etc.
Residential Bridging Loans Birmingham
A common example of residential bridging loans could be an open bridging loan for a house purchase in either first, second, or even third charge, bridging loan choices for inheritance tax, elder care, or even probate issues.
Many lenders will offer open bridging loans for developmental finance as well. This could be for construction, land, or even non-status bridging loans.
General Bridging Finance FAQs
Why choose Bridging Options for bridging loans in Birmingham?
Our bridging loans Birmingham office works tirelessly to connect those needing bridge finance to the lender that will meet their own individual needs.
Whether you need advice on the process in more detail, or you need to be connected to a lender as soon as possible, we are here to help and meet your needs in a timely and professional manner.
As with any fair investment company, and certainly with a mortgage, there are sets of criteria that must be met to secure bridge loans.
Typically, you will need to have perfect exit strategies, adequate and steady income, a property that matches the value of the loan, and decent credit history.
Just like a mortgage, you will also need proof of income to secure bridge finance. This is crucial to ensure you can make up for any deficiencies that may arise if the sale of a property falls through.
The approval process is varied, but you can usually expect the process to complete within 1-3 weeks. The processing of your application is much shorter, and you will typically be connected to a lender within 24-48 hours.
The usual length of these loans is 12 months, but the time allotted before payback of the loan can range as high as three years.
There are also some forms of bridging that can last for only a few months. But one year is certainly the industry standard based on a typical residential type of bridging.
Yes, you must have some form of acceptable collateral in order to qualify for bridging loans. This is almost always a house that you are placing for sale, but depending on the type of loan you are seeking, this could also come in the form of expensive items like jewellery, vehicles, or something of great value that the lender is willing to accept.
You can use a bridging loan calculator to calculate exactly how much you can expect to receive based on the value of your property or the miscellaneous item in question, but it would be worth speaking to a lender first to get approval.