There are a few types of bridging loans and finance to suit any situation. Please call us to discuss the options available to you.

Closed Bridging Loans

A closed bridge is where all terms and conditions of both sale and purchase on both properties have been agreed so the "exit route" or repayment source is already arranged but the funds are not likely to become available in the time required or there is a delay on moving in. A closed bridging loan is used to bridge this period.

Open Bridging Loans

An open bridging loan means that there is not a confirmed repayment method or "exit route".This usually comes about when terms have not yet been agreed on selling one property but you are still determined that you want to go ahead with the purchase of the second property.

By nature, bridging loans tend to be very short term loans, usually covering a period from as little as a couple of weeks to several months. Loan amounts vary from lender to lender, but in the case of bridging loans, as they usually relate to property or commercial use, many lenders have maximum loan limits of up to £1 million.

In terms of the interest rate you are likely to pay, most lenders will typically charge around 2% above their base rate depending on the amount borrowed and length of the loan. There may also be a difference between the rate charged for 'open' and 'closed' loans.

First Charge Bridging Loans

If your property has no borrowing already against it, a bridging loan would be secured on a first legal charge. A first charge bridging loan will replace any outstanding Mortgage and will have a First Charge on your property, making it in effect a very short term mortgage.

Second and Third Charge Bridging Loans

A second charge bridging loan is secured on a property or land that already has a first mortgage that is not being redeemed. Many of the bridging loans we arrange are Second Charge Loans, meaning that we can lend even if the borrower is still making mortgage or re-mortgage payments. This also means that we can lend on unencumbered commercial properties, investment properties, uninhabitable properties and land.

If you already have a mortgage on any type of freehold property or land and it can be shown that there is sufficient equity in the property we can lend on a 2nd or even a 3rd charge basis.

Regulated Bridging Loans

If you are offering a first charge over residential property or a commercial property of which more than 40% is occupied or is likely to be occupied either by you or any member of your family, the loan will need to be a regulated mortgage contract, the advice for which is authorised and regulated by the Financial Services Authority.