Bridging Finance is often taken out where funding is required at short notice, for example, buying a property at auction. However, it has many other uses, the most common being:
- Purchase one property before completion on the sale of another.
- Fund the purchase of a property in need of refurbishment and possibly un-mortgagable in its current condition. The property would then be re-financed after the improvements have been completed.
The list of possible uses is virtually endless, but they often have two elements in common; they are required at short notice and for a short period of time.
Bridging can be either on an “open”1. or “closed”2. bridging basis. We have access to bridging schemes through associate companies that will meet this need, while RM Mortgage Solutions arranges longer term funding to replace the ‘bridge’ once the purchase is complete.
1. An “open” bridging loan requires no pre-arranged exit strategy with the lender.
2. A “closed” bridging loan is where there is a guaranteed exit strategy. The rates for a “closed” bridging loan are usually lower than for an “open” bridge due to the lower risk for the lender.
A mortgage is a loan secured against your home. Your home may be repossessed if you do not keep up repayments on your mortgage or any other debt secured on it.
Please Note: Some forms of Bridging Finance are not regulated by the Financial Conduct Authority.