New business start-ups in the UK are increasingly turning to alternative lenders to help fuel their growth and development. Bridging finance in particular is growing in popularity among the small to medium enterprise (SME) community within the UK.

Certain major banks and lenders consider new business start-ups “high-risk” so they are reluctant to provide finance. This means that despite employing close to 16 million people in the UK and contributing 47% of the total annual turnover for the private sector, new businesses are gaining little access to traditional conventional funding.

In fact, less than 40% of SME companies reported successfully receiving loans from major banks and lenders.

The flexibility of bridging finance

Companies unable to obtain mainstream finance can be helped by the bridging finance sector. Bridging finance is a specialist type of borrowing that secures short-term loans against existing assets. Bridging loans are rarely dependent on income, as often no monthly payments are required, but they are dependent on the equity within the security asset(s) and the strength of the exit, i.e., how the loan will be repaid at the end of the chosen term. Bridging finance is designed to be repaid within a matter of months; however, depending on the situation, the loan can be taken over several years.

For smaller businesses in particular, the immediate benefits of bridging finance are relatively obvious:

• Bridging finance is typically available from £10,000 upwards.
• From application to completion, it can take as little as a few days to access the money needed.
• The most competitive monthly interest rate for a bridging loan is less than 0.5% per month.
• Bridging finance specialists will not automatically discount applicants with an imperfect financial track record or credit history.
• Bridging loans can be used for almost any legal purpose.
• A growing SME, for various reasons, can often need significant funds quickly.

Even when eligibility on the high street is no problem, there are advantages to bridging finance that make it a better option than conventional business loans.

An example of bridging finance in action

A new business start-up is growing faster than expected and has received an influx of sales way beyond its current capacity and infrastructure. The new company needs to expand and develop quickly, recruit new staff, upgrade to larger premises, and purchase new equipment.

The company applied for bridging finance of £200,000 to be repaid at the end of a six-month term. The money was received within a week, and the upgrades were immediately initiated, enabling the new business start-up to operate at a much higher volume. Over £500,000 in sales revenues was generated over the subsequent six months, way beyond the amount needed to repay the £200,000 loan, interest, and fees, and now the company is in a position to handle the increased business volume without any further additional costs.

This is a typical daily scenario where traditional funders were unable to help, but a specialist lender stepped in to arrange the money needed. The now-growing new start-up greatly benefited from a simple and cost-effective bridging loan. The eligibility was assessed only on the basis of the borrower’s security asset along with evidence of a viable ‘exit strategy’ and not on the current or historic income of the business. The firm’s exit strategy was its clear plan for increased sales following cash input from the bridging loan.

Independent broker support

As a new business start-up or SME, it can be difficult to access affordable funding when needed. In addition, taking on any debt during the crucial early days requires careful consideration.

We recommend speaking to an independent broker, such as UK Property Finance, before deciding which path to follow. Whether it is bridging finance or another type of secured property finance loan, comparing the market holds the key to ensuring you get the best possible deal.

Comparing mortgage brokers to bridging specialists is a little like comparing apples to oranges. They both exist for a reason and have their own benefits, but they are nonetheless very different entities.

The popularity of bridging finance continues to grow at its fastest-ever pace. Nevertheless, the vast majority of borrowers in need of sizeable sums for property purchases turn instinctively to mortgage brokers. The problem is that the vast majority of mortgage brokers in the UK lack the knowledge and experience to advise on alternative funding solutions.

In fact, it is estimated that less than 20% of mortgage brokers in the UK have no idea what bridging finance is or its intended applications. Let alone the expertise required to advise on bridging financial options.

The traditional mortgage broker

As the name suggests, a traditional mortgage broker is usually an independent adviser for current and prospective mortgage borrowers. They take into account the requirements and preferences of the applicant, consider their available budget, and scour the market for appropriate mortgage deals. Some work exclusively with major High Street banks, while others also consider loans from specialist lenders across the UK.

However, no allowance is typically made for the consideration of alternative funding solutions. Dozens of conventional mortgage and remortgage products may be analysed, evaluated, and presented to the client, but that’s all. If an entirely different funding solution (such as a bridging loan) represented a better option for the client, a typical mortgage broker may be unable to advise on it accordingly.

Bridging specialists

In a similar vein, alternative funding specialists work closely with major high-street names and independent lenders across the UK. They’re also able to offer comprehensive support and objective advice on all aspects of mortgage borrowing.

The difference is that a bridging specialist can also provide access to an extensive range of alternative funding solutions. From traditional bridging loans and development finance to a variety of accessible and flexible secured borrowing options, there’s far more on the table than traditional mortgages alone.

As a result, the borrower stands a much better chance of finding the perfect funding solution to suit their requirements and budget.

Accessible and affordable

The market for mortgages in the UK has traditionally been somewhat restrictive. In a working example, an individual with a poor credit score or no recent proof of income may be counted out of the running, irrespective of their current financial status.

One of the biggest differences with bridging loans (and other alternative funding solutions) is the consideration of all cases by way of individual merit. So even those who may have been turned down by multiple major High Street names could still access the financial support they need with the help of an independent specialist broker.

For more information on the potential advantages of working with an established bridging specialist, contact UK Property Finance today for an obligation-free consultation.

For many people, their home is their largest and most important investment. Selling a home is a big decision, and it usually takes time and a significant amount of money to make the transaction final. Before your home goes on the market, you can do several things to increase its value. The good news is that these are generally things that are easy to accomplish with a little bit of time and money. When working with a real estate professional, there are a lot of things that they can recommend to make the process easier. For most people, you should budget up to ten per cent of your home for closing costs and other expenses. This is why getting the most out of your home is so important.

Landscaping is a great start

One of the easiest ways to improve the look and feel of your home is through landscaping. Investing in the look around your home can greatly increase the chances of you getting a top price for your home. For a small amount of money invested, you can add ten or twenty per cent to the purchase price of your home.

Get scrubbing!

New homeowners want the home to look clean and tidy on both the inside and outside. Many young families with pets also prefer that a home have a nice fence in the backyard. If you have siding on the outside of your home, make sure it looks freshly painted. Although this seems like a small thing to look at, it can really make your home stand out to new buyers.

Initial price

The initial price that you put your home on the market for is of utmost importance. Over the long term, this can really make your home stand out to new buyers. Never try to price your home too high for the market. Not only does this create a lot of issues for you, but it will make the home sit on the market longer than you would like. Many professionals advise that you figure out what the market value is and price it just below that point. Not only will this make selling your home faster, but it will make it much more convenient as well.

Negotiating is a skill

When it comes to negotiating, you need to make sure that you have multiple people interested in the property. This is why the pricing strategy already outlined makes so much sense. Over the long term, having a quick sale on your home is well worth the few thousand pounds that you take out of the purchase price of the home. With multiple people interested in buying the home, you are able to use leverage and make them pay more than they would otherwise. Overall, selling a home is a huge financial investment. It only makes sense that you spend the appropriate amount of time and money to get as much out of your home as possible.

Our client was looking to borrow against an inherited property to repay an existing bridging loan secured on his own property which was arranged to consolidate debt.

The repayment strategy for the initial 12-month bridging loan had failed as the estate agents were unable to sell the property in the intended timeframe, hence the need to repay this loan as it had come to the end of its term and the current lender was needing repayment. Our client also wanted to raise additional funds to pay for medical costs and to repay money owed to family members which had accumulated during the term of the current loan, following a bereavement.

Finance raised on an inherited property

The inherited property was unencumbered and had to be transferred into our clients name as part of the transaction. UK Property Finance were able to arrange a new loan for our client whilst we used our vast industry contacts to keep in constant communication with their existing lender and solicitors to ensure they remained abreast of the situation and knew the client was doing their utmost to arrange repayment of the loan.

On agreement of the new loan the solicitor provided an undertaking to the lenders solicitors confirming that when the new loan was advanced, the inheritance duty was paid and our clients interest became listed on the property deeds as owner. The clients’ solicitor also confirmed that they would ensure the remaining advance was used to repay the existing bridging loan secured on our clients current property and the medical bills accrued.

The exit or repayment of the new bridging loan was still via sale and due to the extended timeframe agreed our client was able to sell his property without further stress and once the sale was complete our client took up residence in the inherited property which was now owned free of any loans.

Buying land for the first time can be a daunting and challenging process. Even if you’re more than familiar with traditional property procurement, buying land is an entirely different experience. From deciding where to buy land in the first place to finding the perfect land loan for your needs, there’s much to take into account along the way.

As for the ‘best’ way to buy land, the short answer is simple – as strategically as possible. In terms of where you buy the land, why you’re buying it and your chosen land financing option, it’s entirely up to you. But there are nonetheless some universal pointers to consider, which could help you make the right decision.

Examples of which include the following:

• Your main reason for buying the land

You could be looking to buy a plot of land to sell at a later date for a profit.  Alternatively, you could be considering building your dream home, or even an estate of properties to rent or sell. Your ultimate intentions for the land should be factored into every decision you make from start to finish.

• The different types of land available

The type of land you buy will determine if and to what extent you can do anything useful with it. So rather than just buying a plot you liked the look of in a high-demand area, it’s worth first considering its usefulness and versatility or otherwise.

• Funding solutions

Addressing the issue of how to finance land investments, there are myriad options to explore. From specialist land loans to development finance to bridging loans to agricultural loans, it depends on your current financial circumstances and intentions for the land.

• Compare the market

How much is agricultural land per acre to buy? How long is a piece of string! The answer will vary significantly from one area to the next, in accordance with both demand and the capacity for the land to generate healthy returns. Hence, it can be useful to compare the market and consider a variety of locations where possible.

• Consider planning permission requirements

Assuming you plan on developing the land you purchase in some way or another, it’s worth factoring in any planning permission requirements you may need. Depending on the type of land you purchase, it could be easy, difficult or impossible to receive formal permission to develop or build on it. Always better to find out before you go ahead and commit to the purchase.

• Organise a reliable survey

As with any property you intend to purchase, it’s important to have the land meticulously and professionally inspected from top to bottom. From flood risks to boundaries to potential hazards of all shapes and sizes, it’s impossible to evaluate the value and potential of a plot of land with a fleeting glance.

• Focus on future demand

Rather than considering what the plot of land is worth today, think carefully about its ongoing growth potential. For example, if the area is scheduled to benefit from improved public transport links or the development of an industrial park in the near future, this could have a marked impact on the value of your investment.

• Secure professional representation

Last but not least, it always pays to have the experts on your side when considering an important investment. So rather than going it alone, secure professional representation from the earliest possible stage from a reputable independent specialist. Even if you know what you’re doing, an additional objective viewpoint could prove invaluable.

Martin Lewis is a household name in the UK when it comes to personal finance. His website, Money Saving Expert (MSE), is a treasure trove of information and guidance on navigating the complex world of money matters. But what exactly can you learn from Martin Lewis on bridging loans and all the other types of finance? Buckle up, because we’re diving deep into the financial topics he tackles and how his advice can empower you.

Mastering the Basics: Savings and Everyday Banking

One of Martin Lewis’ core strengths is his focus on financial fundamentals. He demystifies savings accounts, explaining the difference between easy access and fixed-rate accounts and helping you choose the one that aligns with your goals. He also sheds light on current accounts, with insights on overdrafts, fees, and switching incentives to maximise your banking benefits.

Debt Management: From Credit Cards to Mortgages

Martin Lewis doesn’t shy away from tackling debt. He offers clear advice on managing credit cards, including balance transfer offers and 0% interest periods, to help you repay efficiently. When it comes to mortgages, he empowers you with knowledge on fixed-rate vs. variable-rate deals, helping you secure the best mortgage for your circumstances.

Exploring Investment Avenues: ISAs and Beyond

If you’re looking to grow your wealth, Martin Lewis provides valuable guidance on individual savings accounts (ISAs). He explains the different ISA types, from cash ISAs for easy access to savings to stock and share ISAs for long-term investments, allowing you to make informed decisions. He also explores other investment options, helping you navigate the world of stocks, bonds, and pensions.

Specialist Solutions: Bridging Loans, and More

Martin Lewis understands that financial needs can be complex. While he doesn’t directly offer bridging loans, a specific type of short-term loan secured against property, he provides clear explanations on how bridging loans work. This could help you to decide if a bridging loan is the right solution for your situation, such as buying a new property before selling your old one. He also delves into other specialist areas like insurance, travel money, and even PPI claims.

Free Resources and Tools at Your Fingertips

Money Saving Expert is a goldmine of free resources. There are eligibility checkers to help you find the best credit card deals or see if you can claim mis-sold PPI. There are also downloadable comparison tables and guides, all designed to put you in control of your finances.

Martin Lewis: Empowering You to Make Informed Decisions

Martin Lewis’ core message is clear: knowledge is power. By providing clear, jargon-free explanations and up-to-date information, he empowers you to make informed financial decisions. Whether you’re navigating everyday banking, tackling debt, exploring investment opportunities, or looking for bridging loans. Martin Lewis equips you with the tools and knowledge you need to take charge of your financial future. 

In the dynamic world of property transactions and financial emergencies, bridging loans have emerged as a lifeline, providing temporary funding solutions to bridge the gap between financial requirements and available resources. While these versatile loans offer a helping hand, a common question arises: Can anyone get a bridging loan? The answer, though seemingly straightforward, involves a nuanced understanding of eligibility criteria, lender requirements, and the importance of seeking expert guidance.

Eligibility criteria: the gatekeepers of bridging loans

Bridging loans, unlike traditional mortgages, do not adhere to rigid eligibility criteria. Instead, lenders focus on assessing the specific circumstances of each borrower, considering factors such as:

• Loan Purpose: The intended use of the bridging loan is critical in determining eligibility. Loans for property transactions, business funding, or unforeseen expenses are typically prioritised by lenders.
• Loan amount: The requested loan amount is weighed against the borrower’s financial situation and the value of the property being used as security (if applicable).
• Credit history: A borrower’s credit history reveals information about their repayment history as well as their overall financial responsibility. Borrowers with a good credit history are preferred by lenders.
• Property equity: If the bridging loan is secured by a property, the lender will determine the maximum loan amount based on the borrower’s equity in the property.
• Exit strategy: It is critical to have a clear exit strategy outlining how the loan will be repaid. Lenders want to ensure that the loan is repaid in a timely manner.

Lender requirements: tailored to individual needs

While eligibility criteria provide a general framework, individual lenders may have specific requirements.

These may include:

• Minimum and maximum loan amounts: Lenders may set minimum and maximum loan amounts they are willing to provide.
• Property type: Some lenders may specialize in financing specific property types, such as residential or commercial properties.
• Repayment term: Repayment terms for bridging loans can vary, and lenders may have preferences for certain timeframes.
• Interest rates: Interest rates on bridging loans can differ based on the lender’s risk assessment and market conditions.

Navigating the maze: the role of a broker

Given the complexities of bridging loan options and the importance of obtaining favourable terms, consulting with an experienced broker can be extremely beneficial. A trustworthy broker acts as a go-between for borrowers and lenders, offering expert advice, comparing options, and negotiating favourable terms on your behalf.

UK Property Finance: your trusted partner in bridging loan solutions

UK Property Finance is a leading provider of bridging loan solutions in the United Kingdom. With a large network of lenders and a thorough understanding of the market, ukpropertyfinance.co.uk can assist you in locating the best bridging loan for your specific needs. Their experienced team of brokers will walk you through the entire process, from initial assessment to loan closing, ensuring a smooth and successful outcome.

In conclusion:

The question of who can get a bridging loan is not a simple yes or no. Eligibility depends on a combination of factors, including the borrower’s financial situation, the purpose of the loan, and the lender’s requirements. While anyone can potentially apply for a bridging loan, securing the right terms and navigating the maze of lenders can be challenging. Seeking guidance from a trusted broker like UK Property Finance can significantly increase your chances of securing the ideal bridging loan solution for your needs. With expert guidance and a clear understanding of your financial situation, you can unlock the doors to short-term finance and bridge the gap towards your goals.

At UK Property Finance, we recognise the allure of overseas property development as an enticing investment avenue. In today’s interconnected world, where boundaries are becoming increasingly fluid and international travel is more accessible than ever, individuals and businesses are eager to explore global opportunities. However, financing overseas property development projects can be complex. That’s precisely why we believe in the transformative power of bridging loans to unlock these exciting prospects on a global scale. In this blog post, we will delve into the potential of bridging loans for overseas property development and how they can assist investors in seizing global opportunities.

Understanding overseas property development

Overseas property development involves acquiring and developing properties in foreign countries. It encompasses a range of real estate projects, including residential, commercial, and mixed-use developments. The appeal of overseas property development lies in the potential for high returns, diversification of investment portfolios, and the ability to capitalise on emerging markets.

The role of bridging loans in overseas property development

Bridging loans serve as valuable financial tools for overseas property development. These short-term loans bridge the gap between property purchases and long-term financing or cover construction and renovation costs. By providing borrowers with quick access to funds, typically within weeks, bridging loans enable them to move forward with their projects promptly.

The advantages of bridging loans for overseas property development:

Bridging loans offer several distinct advantages for overseas property development ventures. They provide investors with the necessary capital to acquire land, develop properties, or renovate existing structures, even in foreign countries where securing traditional financing can be challenging.

Flexibility is a key feature of bridging loans for overseas property development. These loans can be customised to meet the specific requirements of the project, including loan duration, repayment terms, and the release of funds at different stages of development. This flexibility allows developers to adapt to the unique challenges and timelines associated with overseas projects.

Collaborating with experienced lenders

When considering a bridging loan for overseas property development, it is essential to partner with experienced lenders who specialise in international financing. These lenders possess in-depth knowledge of the complexities involved in financing projects abroad and can provide valuable guidance throughout the process.

Experienced lenders understand the legal and regulatory frameworks of various countries, assisting borrowers in navigating potential hurdles. They also offer insights into local market conditions, project feasibility, and risk mitigation strategies, empowering investors to make well-informed decisions.

Furthermore, established lenders with global networks can facilitate connections with local experts, including legal professionals, architects, contractors, and property management teams. This network of professionals streamlines the development process and ensures compliance with local regulations.

Overseas property development offers exciting global opportunities for investors and developers seeking diversification and higher returns. However, securing financing for such projects can be challenging, particularly when dealing with unfamiliar legal and economic environments. Bridging loans offer a practical and flexible solution for funding overseas property development, providing quick access to capital and tailored financing options.

To embark on bridging loans for overseas property development, it is vital to collaborate with experienced lenders who understand the intricacies of international financing. Their expertise, combined with a network of professionals in the target country, significantly enhances the success and profitability of the project.

As global opportunities continue to emerge in the property development sector, bridging loans for overseas projects are poised to play a crucial role in empowering investors and developers to capitalise on these exciting ventures. With the right financing partner and thorough due diligence, investors can turn their global property development aspirations into reality.