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No More Gaps Between Successive Real Estate Deals


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There are some loan plans available in the UK loan market which are used to ‘bridge’ the financial gap between the sale of one property and the purchase of another. These loans allow the borrowers to purchase the second property before selling their existing property.

These loans are immensely beneficial in several situations. They allow the businessmen in the ‘Buy to Let’ segment of the realty market to achieve a discount for a faster completion. It is equally beneficial for auction purchases, where funds are required to be deposited quickly. Budding entrepreneurs who require a quick injection of cash to fund a new business project can avail these opportunities to improve the profit potential. Property developers, utilising the speed of this can have quick real estate deals.

Bridging loan deals offer you the fast cash when you need it the most. The immovable property market has numerous growth opportunities but many can be left on the shelf due to the shortage of cash. The growth opportunities are blocked either through the chain break or the lender not having funds in place quickly enough. To add to this situation, a discount on a property is a definite possibility if funding can be arranged fast. Bridging Finance is a fast and hassle free solution to all these headaches.

Bridging Finance tends to be ‘Non-Status’ compared to other loan plans. Lenders consider the type and quality of the property as security and then only offer the required cash. Unlike traditional loan plans, these secured loans are offered for a period of maximum one year. Maximum available loan amount is 75% LTV (Loan-To-Value), in some cases 85% LTV may be available if the credit score of the person is extremely good. Apart from credit checks, other important factor is the location of the pledged security, as the market value depends upon the location, the lender gives more importance to it.

Bridging loan deals can bridge a financial gap. But it should never really be considered a permanent solution as they are short term in nature and demand a higher rate of interest. A more permanent solution in the form of a regular loan plan should be considered if the property is to be held on to long-term. Or in the case of a more speculative real estate investment. However, bridging loan is flexible in another way. In terms of the redemption date it can be classified as both ‘open’ with no definite end to the loan, or ‘closed’ with a mutually agreed redemption date. It is advisable to go for the open variety when you are confident of the sale of your existing property or the replacing of the loan with a more long-term finance solution. This loan remains the fastest and most appropriate loan type for making a property purchase quickly.

About The Author: For more information about bridging finance loans and personal loans. Please visit our website:


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