Bridging Loan Lending Criteria

The lending market in the United Kingdom is serviced by more than 150 providers, ranging from private individuals to the biggest lenders in the country.

All of which adds up to a market where fees, charges and interest rates vary significantly from one provider to the next. As does the lending criteria applicants must meet to qualify for a bridge loan in the first place.

By working with the largest panel of lenders possible, we can provide our customers with the following:

Loan Sizes

£50,000 to £1 billion*

*figurative sum – bridge loans are available up to any value whatsoever

Term

Minimum 24 hours, maximum of 36 months

Bridging loans are designed to be repaid in full over a comparatively short period of time. Most lenders in the bridging sector lend up for a maximum of 18 months, though some offer terms up to 36 months.

FCA regulations limit regulated loans to a maximum of 12 months.

Security

Bridging lenders typically require collateral in the form of property. Loans can be secured on the value of one property for several combined properties. The lender and borrower will enter into an agreement whereby the service provider takes ownership of the property in the event that the loan is not repaid as agreed.

The loan is secured by the lender taking charge of the property, registered at land registry by way of a first charge, second charge or sometimes a third charge

Property Types

The vast majority of property types can be considered for bridging loans, included but not limited to:

Flats
Bungalows
Houses
Shops
Industrial units
Offices
Mixed-use of properties
Health clubs
Hotels
Guesthouses
Restaurants
Bars
Garages
Parking spaces
Holiday homes
Land

Typically, however, the very best deals in terms of interest rates and charges are those which are secured on residential property.

Other Security

In some instances, service providers may offer bridging loans secured against other personal possessions and assets, including cars and other vehicles, watches, jewellery, precious metals and stones, antiques and artwork.

Get in touch if you require more information on alternative security for a bridging loan.

Property Condition

While the condition and overall value of the property will be taken into account, many bridging lenders are willing to accept property in need of restoration or in generally poor condition as collateral.

In fact, bridging loans have become something of an industry standard for developers looking to raise funds for property renovations and improvements.

Location

We can arrange bridging loans for applicants anywhere in the United Kingdom:

Loan facilities are available nationwide:

London + within M25 – Specialist Low-Cost Plans Available

England
Scotland
Wales
Northern Ireland (Limited facilities up to 50% LTV)

We can also help you secure the finances you require if you are located in:

Europe
USA

Availability

Most bridging lenders open their products and services up to businesses and individual borrowers alike. We specialise in securing intelligent finance for:

Private borrowers
Limited companies
Partnerships
Offshore companies

Age of applicant

Every service provider imposes a minimum of applicant age of 18 years. While some lenders impose maximum age limits, others don’t. Unless there is a Power of Attorney in place, the applicant must be comprehensively aware of what it is they are applying for.

Credit History

Where collateral/security is required, credit history is typically inconsequential. Which is why bridge loans can be particularly useful for those with:

CCJs
Defaults
Arrears
IVAs
Bankruptcy
Repossessions
Statutory Demands
Winding up orders

Income Evidence

Likewise, provision of sufficient collateral renders proof of income unimportant. As bridging lenders do not collect staggered payments on a monthly basis, evidence of income is not required.

Loan Use

A bridge loan can be put to use for any legal purpose whatsoever, such as:

Funding restoration and renovation work
Purchasing properties at auction
Buying properties before selling a current property
Meeting unexpected expenses and clearing debts
Fulfilling taxation requirements to avoid penalties
Injecting cash into a new business or purchasing an existing business
To cover some or all of the costs of a development project

Interest Payments

Unlike a conventional loan or mortgage, interest is typically added to a bridging loan in one lump sum which is then paid in full when the loan itself is repaid. However, some service providers allow borrowers to pay the required interest on a monthly basis, though this may require the submission of proof of income.

Exit Route (How a bridging loan is repaid)

There are countless options for the repayment of a bridging loan, which include:

Property or asset sales
Receipt of money owed
Inheritance
Refinance
Policy reaching maturity