4 Ways Bridging Finance Can Be Used for Your Next Project
Bridging loans typically last for 12 months or less and are seen as a viable option for many due to how quickly they are processed, how flexible they are, and how they can often be approved when mortgages cannot.
Plenty of different people use bridging loans today. From landlords and homebuyers, to property developers and entrepreneurs looking to fund new initiatives, bridging loans have helped a wide range of people to achieve their aims and goals.
Refurbishments and Conversions
Refurbishing buildings or changing them in substantial ways can be highly profitable, which makes it all the more frustrating when it is not possible to obtain quick, reliable finance to fund such a venture. This is where bridging loans often come in to provide the solution.
If you need to spruce up a run-down property, or simply add an extension to your existing property, a bridging loan can help you to do everything you need to get the job done and add value to your build. Other projects, like self-build homes, barn conversions, and large-scale conversions can also be funded by bridging loans.
Most mortgage lenders will not provide a mortgage for an uninhabitable property. If the building does not have a working bathroom or kitchen, for example, or if any other form of extensive renovation needs to take place, it can be hard to secure the finance needed to purchase a property like this.
However, bridging loans are often approved for such ventures, making them ideal finance options for enterprising property developers who see the potential in run-down buildings. Even if planning permission has not yet been obtained for a building, bridging loans can usually still be obtained.
If you are looking to buy a new home quickly and you do not want to be caught in a complex chain, taking out a bridging loan can be a fast and effective way of securing the finance you need to make the purchase. Also, if you are going to auction and you cannot wait for mortgage lenders to process your application, a bridging loan can help you buy the property you want with no quibbles.
Financing Other Initiatives
Small companies are integral to our economy, but they can find it difficult to obtain the finance needed to support their ventures. Luckily, bridging loans can also be used to help finance SMEs. Loans like this can be particularly useful to new businesses that need to secure funding quickly over a short-term period. For example, bridging loans can be taken out by businesses growing so rapidly that they need a quick financial solution in order to facilitate their rapid advancement. For example, securing a bridging finance loan against a property to purchase new engineering equipment.
Find Out More
Whether you want to invest in an enticing new property deal, or you have a different kind of project in mind, bridging loans can help you to make the profit you envisage. Find out more about how bridging loans work in our Beginner’s Guide to Bridging Finance, so that you can start planning your next venture.