Bridging Finance Guide – What is a Bridging Loan?

Written by admin

What is a Bridging Loan?

A Bridging Loan is short term funding to provide temporary financing until more permanent finance can be found. Bridging Loans are available for a whole range of financial requirements and can be on the basis of a 1st, 2nd or even 3rd charge equity release, usually provided for any legal purpose.

Examples:Â

Commercial & Residential Purchase Commercial & Residential Refinance Auction Purchases Capital Raising * Chain Breaking Refurbishment Speculative Deals Business Cash Injection Defective Property

Â

* Capital raising funds can be used for many reasons including holidays, overseas property investment and tax bills etc.

SecurityÂ

Residential Property Commercial Property Land (with or without planning permission in place) Real Property (such as Plant machinery)

Â

Bridging Loans carry a higher interest rate than standard mortgage lending and at the offer of loan stage there will be an agreed term of repayment, normally between one day and two years.

Bridging Loans are most commonly used when the financing requirement is urgent and beyond the timescales that a standard mortgage lender or bank could provide. In some cases Bridging Lenders can provide funds within 24 hours. Another common use of bridging finance would be to fund the purchase a new home prior to the existing property being sold.

CharacteristicsÂ

Bridge loans will almost certainly carry higher fees which can include:Â

Administration Fees Arrangement Fees Legal Fees Completion Fees Valuation Fees Exit Fees ** Broker Fees (normally non-disclosed)

Â

** A fee charged to redeem the loan, typically equivalent to one month’s interest payment.

As most bridging Loans are not regulated by the Financial Services Authority the above fees can vary substantially as they fall within no boundaries or guidelines, only competitive pricing.

ApplicationÂ

Bridging Lenders will consider loans to discharged bankrupts and clients with adverse credit such as CCJs and IVAs. They will lend to individuals as well as Businesses, Ltd Companies and tax efficient vehicles such as SPVs.

VariationsÂ

Bridging Loans are split into two main categories:

Closed Bridging FinanceÂ

At the time the funds are drawn down there is a firm exit in place to repay the loan normally within a short period of time. The most common use of Closed Bridging Finance would be the pending sale of an existing property on which contracts have been signed and exchanged/missives concluded

Open Bridging Finance

At the time the funds are drawn down there is no fixed exit or repayment method for the lenders comfort, only an agreed maximum term that the loan can run for. Seen as higher risk than closed Bridging Finance it is therefore more expensive.

Other forms of short term finance:

Mezzanine Finance

Often a combination of debt and equity stake which is typically used to finance the expansion of existing companies. To secure mezzanine finance the business would normally have to demonstrate a track record in the industry with an established reputation and product, a history of profitability and a viable expansion plan for the business (e.g. expansions, acquisitions, IPO).

Lenders

There are over 20 Primary Bridging Lenders in the UK that are able to lend their own funds and therefore set their own criteria of risk.

Private Financers

Should Bridging Lenders decline to lend, Private debt and equity financers can be sort to provide funding for the examples above. This type of finance is normally very expensive.

Specific Uses

Bridging Loans can be used as a Below Market Value (BMV) purchase instrument where the initial purchase takes place at the lower purchase price allowing a subsequent refinance application to be placed with a mainstream lender for borrowing based on the Open Market Value of the property with the purpose of releasing the difference in equity between the purchase price of the property and the higher resulting remortgage loan.

Costs

Bridging Loans typically cost between 1-2% per month. Variable rates with margins over Libor can sometimes be applied as an alternative or an addition.

Find an Independent Bridging Finance Broker to give you all the available options.

0 Comments
Categories: Finance Guide
Tags: , , ,
Dec
31

A Guide to Getting Single Mother Financial Assistance

Written by admin
We’ve all heard how difficult it is for single mothers to make ends meet. It’s true that in terms of financial ability, single mothers are usually on the lower end of the scale. It’s very rare to find moms who are raising families alone to be doing well financially. This is especially true for young single mothers.

Because single mothers are often in a position where they simply cannot get the help they need on their own, they have to look at getting some help from someone else.

There is help available, but you just have to look for it in the right places. I suggest you start your search using the search engines and look at what sort of single parent help websites you can find. These websites will often list some aid programs you can seek out. These are a good starting point to look for help.

You can also look at getting a government grant of some sort. Now there are many types of grants out there. Some of the more popular government assistance programs would include federal welfare and housing assistance programs. There are no real “single mom grant” programs out there that you can directly apply for, but if you look around, you can find some government programs that will offer you food stamps, assistance with rent, etc.

It’s a good idea to look at what sort of aid you can turn up offline. This means looking at what non profit organizations may be able to offer. There are charities, for example, that may help out single mothers. When you have some need, it’s best to look at every option out there. Look for some websites that offer you a list of private organizations that you can seek out help from – there are a few floating around on the web.

0 Comments
Categories: Finance
Tags: , ,
Dec
30

A Guide For Online Car Loans

Written by admin
Who else wants to enjoy the comfort of travelling in a car? But you don’t have sufficient funds to purchase the vehicle you wish to possess? Don’t feel bad about that. You can easily have your dream of getting your very own car. A car finance loan is the key to your dream and is very popular way of buying a car when you don’t have enough cash. Online car loans are becoming very popular these days as they save you from physical harassment and are quick to approve saving you time and money.

Using the internet for online finance.

You will get different features in different car loans and the internet helps you to research all of all the different offers available. Without doubt the internet is the fastest and the easiest medium to get car loans. Approvals can be instant, and you can still get finance even if you have a bad credit rating. You need not show any guarantee for loan repayment and the interest rates of these online car loans are also quite low.

Why go online?

The online process is one of the best and easiest way of getting a car loan. This is the way of the future; modern technology has everything done electronically online. From the filling up of the application form to the submission of various necessary documents, and then the repayment of the debt. You don’t have to take the trouble of rushing to a loan offering company; you can do everything just sitting in your chair at home.

The borrower of the car loan can avail both the secure and the unsecure forms of the online car loan. The rate of interest between the two types of loans differs. Since you need to pledge your assets when going for the secure one the rate of interest here is lower than the unsecure one. This is so because in the secure car loan the repayment of the amount is guaranteed. Generally five to seven years is granted for the repayment of the loans.

Yes it is easy to get?

The process is very simple simple. First you need to bring a quotation from the car dealer. The next step is to fill out the online application form. There are also options for going for partial financing. You can choose this option if you can arrange for the rest of the finances by yourself. It is a very easy process and once you fulfill some basic requirements needed to get the money, the car is yours!

0 Comments
Categories: Finance
Tags: , ,
Dec
30