For many aspiring homeowners, the idea of purchasing a house at auction is an enticing prospect. Auctions often present the opportunity to acquire a property at a potentially lower cost than its market value. However, the challenge lies in securing the necessary funds quickly to participate in such a time-sensitive process. This is where bridging loans come into play, offering a flexible and efficient solution to bridge the financial gap. In this blog post, we will explore the question, “Can I borrow money to buy a house at auction?”

Understanding the challenge

Buying a house at auction requires a rapid and substantial financial commitment. Traditional mortgage processes can be time-consuming and may not align with the urgency of auction timelines. Additionally, auction properties often require immediate deposits, making it challenging for potential buyers to arrange financing through conventional channels.

The solution: bridging loans

Bridging loans serve as a short-term financing option designed to “bridge” the gap between the purchase of a new property and the sale of an existing one or another long-term financing solution. These loans are known for their speed and flexibility, making them an ideal choice for those looking to secure funds quickly for a property auction.

BridgingLoans.co.uk: your trusted partner

As a leading financial service provider, we specialise in offering bespoke bridging loan solutions tailored to individual needs. Here’s why we stand out from the crowd:

• Speedy approval process: We understand the time sensitivity of property auctions. Their streamlined application and approval process ensures that you can access the funds you need promptly.
• Flexible repayment terms: The flexibility of bridging loans allows borrowers to repay the loan once their long-term financing solution is secured. BridgingLoans.co.uk works closely with clients to design repayment plans that align with their financial circumstances.
• Specialised expertise: With years of experience in the industry, BridgingLoans.co.uk has developed a deep understanding of the property market. Their team of experts can provide valuable insights and guidance throughout the loan process.
• Competitive interest rates: We are committed to offering competitive interest rates, ensuring that borrowers can access the funds they need without compromising their financial stability.

Buying a house at auction can be a lucrative investment, but the key lies in securing the necessary funds swiftly. Bridging loans present a viable solution for individuals looking to capitalise on auction opportunities. With our expertise, efficiency, and commitment to client satisfaction, we stand as a reliable partner in your journey towards homeownership. Consider exploring the possibilities of bridging loans to turn your auction dreams into reality.

Facing repossession proceedings can be an overwhelming and stressful experience. However, it’s crucial to know that there are avenues available to stop repossession and regain control of your financial situation. In this blog post, we’ll address the question, “How do I stop repossession proceedings?” and shed light on the potential solution of using a bridging loan to navigate through these challenging times.

Understanding repossession proceedings

Repossession proceedings typically begin when a homeowner falls behind on mortgage payments. In such cases, the lender may take legal action to repossess the property to recover the outstanding debt. It’s a distressing situation, but there are steps you can take to intervene and prevent the repossession process from moving forward.

1. Open communication with your lender: The first and most important step is to communicate openly with your lender. Explain your financial difficulties and demonstrate a willingness to find a solution. Some lenders may be open to renegotiating the terms of your mortgage or offering temporary relief.
2. Seek professional advice: Consult with financial advisors or housing counsellors who specialise in foreclosure prevention. They can provide valuable insights, assess your financial situation, and guide you through available options.
3. Consider a bridging loan: One effective strategy to halt repossession proceedings is to explore the option of a bridging loan. Bridging loans act as short-term financing solutions, providing the funds needed to settle outstanding mortgage arrears and stop the repossession process.

Using bridging loans to halt repossession:

Bridging loans can be a lifeline for homeowners facing repossession. Here’s how these loans can help:

• Immediate access to funds: Bridging loans offer a quick and straightforward application process, providing borrowers with swift access to the funds they need. This speed is crucial when dealing with repossession proceedings, as time is of the essence.
• Settling mortgage arrears: Bridging loans can be used to settle outstanding mortgage arrears, bringing your account up to date and preventing the repossession process from advancing further.
• Temporary financial relief: Bridging loans provide a temporary financial solution, giving homeowners the breathing room needed to address their financial challenges. This temporary relief allows you to explore long-term solutions without the immediate threat of repossession.

In conclusion

Stopping repossession proceedings requires proactive measures, and exploring a bridging loan is one such strategy that can provide swift and effective financial assistance. If you find yourself in a challenging situation, don’t hesitate to reach out to your lender, seek professional advice, and consider the option of a bridging loan to regain control of your financial future. Remember, timely action is crucial in preventing repossession, and there are resources available to help you navigate through these difficult times.

Ownership of a listed building in the UK comes with a long list of pros and cons.

On the plus side, you may find yourself in possession of a completely unique property with the potential to generate huge capital gains over the course of time. Not to mention, it is an inspiring place to call home for yourself and your family.

In terms of disadvantages, the upkeep of a listed building can be much more of a challenge than that of a conventional home. There may also be strict limitations placed on modifications that can be made to the property (inside and out), ruling a great many potential renovations and improvements out of the equation.

Then comes the small matter of funding the purchase of a listed building, which is not quite as easy as simply shopping for a conventional mortgage.

There are three types of listed properties in England and Wales, which in all instances call for an entirely different type of mortgage:

• Grade 1: Buildings of outstanding or national architectural or historic interest
• Grade 2: Particularly significant buildings of more than local interest
• Grade 2: Buildings of special historic or architectural interest

The overwhelming majority of listed buildings (around 92%) fall within the Grade 2 category. This means the lowest level of protection and preservation, but at the same time, it can still result in major restrictions on what can actually be done with the property you buy.

For example, you may need to obtain formal planning permission simply to upgrade the windows or doors or to install exterior decking.

But many would argue that what you get in return more than justifies the downsides. Living in a listed property can be a genuine joy, but how do you fund the purchase of a listed building in the first place?

The Grade 2 listed property mortgage market

Qualifying for (or even tracking down) a mortgage for a Grade 2 listed property on the High Street can be difficult. Many lenders do not offer such products at all, and those that do have a tendency to restrict them to borrowers who fulfil fairly extensive eligibility requirements.

For example, interest rates on a mortgage for a listed property will usually be similar to those of a conventional mortgage. But while a standard mortgage may call for a minimum deposit of just 10%, it is often necessary to provide a deposit of 25% to 30% for a specialist mortgage for a listed building. In addition, it is not always possible to take out a mortgage on a listed building over a term of more than 20 years.

Mortgage availability and qualification criteria differ significantly from one type of listed building to the next. In the case of a listed property that features outbuildings, comes with a significant amount of land attached, or is used for any type of commercial or semicommercial purposes, finding an accessible and affordable mortgage can be more difficult.

Purchasing listed properties with specialist loans

Enlisting the support of an experienced broker can simplify the process of tracking down an affordable mortgage for a listed property. There are countless options available on the secured lending market, including short-term bridging loans.

Unlike a traditional mortgage, a bridging loan can be arranged within a few working days, and the funds can be used to purchase any type of property in any state of repair. They can also be taken out by individuals with poor credit, no formal proof of income, or even a history of bankruptcy. Whether you are planning to live in the property yourself, retain ownership for BTL purposes, or sell it on for capital gains upon completing any necessary refurbishments, a bridging loan can be a uniquely flexible and cost-effective solution.

Research from Home Selling Expert suggests that a full 31% of all UK home sales fall through at least once before a transaction is completed. This essentially means that buyers and sellers alike have a one in three chance of their plans being laid to waste by broken property chains.

A broken property chain occurs when one or more links in the chain of buyers and sellers fall through, resulting in the entire process being delayed or falling apart. This can be frustrating and costly for all parties involved, but it is also something that can be avoided in many instances.

Of course, there is very little anyone can do to control the behaviour of others involved in a property chain. Buyers and sellers alike are at the mercy of others within the chain, over whom they have little to no influence.

Even so, there are several steps that buyers and sellers can take to reduce the risk of a broken property chain.

Examples of these include the following:

1. Be honest and open. It is important for buyers and sellers to be upfront about their circumstances and any potential issues that could affect their ability to complete the sale. This includes disclosing any financial issues, such as credit problems or debts, as well as any concerns about the condition of the property.
2. Get a mortgage in principle: Buyers should obtain a mortgage in principle before starting the property search. This will give them a better idea of what they can afford and can also help speed up the process once a property has been found.
3. Choose a reputable conveyancer: Both buyers and sellers should work with a reputable conveyancer to handle the legal aspects of the sale. A good conveyancer will be able to identify any potential issues and work to resolve them in a timely manner.
4. Be prepared for delays. Even with careful planning, delays can still occur. It is important for buyers and sellers to be prepared for this possibility and to have contingency plans in place in case the sale is delayed.
5. Be patient: The property process can be stressful and time-consuming, and it is important for all parties to remain patient and flexible.
6. Get a survey: Both buyers and sellers should consider getting a survey of the property before the sale. This can help identify any potential issues and allow both parties to address them before the sale is completed.
7. Consider a bridging loan: If there is a significant gap between the completion dates of the two properties, buyers may want to consider a bridging loan to cover the period in between. This can help reduce the risk of the sale falling through due to financial issues.
8. Get a HomeBuyer report: A HomeBuyer Report is a detailed document that covers the condition of the property and any issues that need to be addressed. This can help buyers understand the true condition of the property and make informed decisions about the purchase.

Of the mitigation methods outlined above, the single best way to reduce the risk of a broken property chain is to accelerate the completion process with bridging finance.

Bridging loans afford mainstream bidders all the benefits usually reserved for cash buyers. Secured against the value of their current home, bridging finance can be arranged and accessed within a few working days, enabling buyers to beat competing bidders to the punch. For more information on any of the above or to discuss the benefits of bridging finance in more detail, contact a member of our team anytime for an obligation-free consultation.

Most homeowners looking to relocate barely think twice about completing a mortgage application. They simply apply for and (perhaps) receive a mortgage instinctively, locking themselves into the same binding long-term agreements as everyone else.

But what if there was a better way for existing homeowners to move to new homes without going down the usually complex and costly channels? Are there flexible, accessible, and affordable alternatives to conventional mortgage loans that are broadly available to mainstream borrowers?

Surprisingly, the answer is yes, and it takes the form of bridging finance.

To put the whole thing into some kind of perspective, here are just six of the countless ways a bridging loan can be better than a mortgage:

• Faster applications: With a mortgage application, it is not uncommon to wait up to 8 or even 12 weeks to gain access to the money you need. With bridging finance, the whole process can be wrapped up in just a few working days, never more than a couple of weeks. When time is a factor (which has a tendency to apply to all property purchases these days), bridging finance can be so much faster to arrange than a conventional mortgage.
• Property purchases for cash: With bridging finance, you essentially turn yourself into a cash buyer. By doing so, you gain access to all the benefits usually reserved for those who buy homes for cash. You can bid on properties at auction, you can place offers on off-market properties of all kinds, and you can qualify for preferential rates by buying your next home for a single (and fast) lump-sum cash payment.
• Easy to obtain: Comparatively speaking, obtaining a bridging loan can be surprisingly straightforward. Eligibility criteria for bridging loans tend to be much more relaxed than with a conventional mortgage. Your credit history and income level will not necessarily stand in your way, just as long as you provide your lender with proof of a viable exit strategy (how you intend to repay your loan). It is even possible to qualify for bridging finance with no formal proof of income and/or a history of bankruptcy.
• Can be used to purchase any property: Major banks place heavy restrictions on the kinds of properties their mortgages can be used to purchase. Elsewhere, bridging loan specialists place no such restrictions whatsoever on their products. If you qualify for a bridging loan, you can use the funds to purchase any type of property you like. This includes properties that would normally be considered ‘not mortgageable’, making it much easier to pick up homes in questionable conditions to then renovate to a higher standard.
• Rock-bottom interest rates: Bridging finance is designed to be repaid as promptly as possible and can be hugely affordable as a short-term solution. Interest is applied monthly at a rate as low as 0.5%, and all other borrowing costs are kept to the bare minimum. Most bridging finance specialists impose no fees or penalties for early repayment, meaning significant sums of money can be saved by repaying the full balance as quickly as possible. Unlike a mortgage, where early repayment can be extremely expensive, assuming it is even an option at all,
• No restrictions on spending: A traditional mortgage comes with the caveat of being issued exclusively for the purchase of a property. With bridging finance, the money can be used for absolutely any legal purpose whatsoever. You could use a chunk of the money to purchase a home or business property and spend the rest in any way you like. Lenders have little to no interest in how their money is to be used; they simply need to know that they will get it back in full and on time.