Stuck with a bridging loan?

Are you stuck with a bridging loan?

Bridging loans are a great resource for the property professional and allow a faster purchase of a property, help a purchase to go ahead when the property is not “mortgageable” (ie it may not have a bathroom or a kitchen or might need other renovation to make it habitable) or to free up capital locked up within a finished project due for sale.

Whatever the reason for taking a bridging loan one thing is always important – you should not enter a bridging loan without an eye on the exit.

But, as they say, “There’s many a slip twixt cup and lip” – things can go wrong with even the best planning – so how can help when you are stuck in a bridging loan?

Bridging loan exit options

There are only two means to plan a bridging loan exit, others such as lottery wins, windfalls etc leave too much to chance. You should plan one of these two options;

Selling might not be the fastest way to repay the bridging loan you are stuck in but it is the way which will release the most funds for you to move onto the next project. The main consideration though must be the time it would take to complete a sale and the monthly cost of the bridging loan, especially if it is due to go into default. In order to complete a fast sale many sellers turn to an auction – the sale can be completed within a month (typically) of the auction date but due to the limited market the price will be “rock bottom”. A traditional sale through an agent or personal contacts could take much longer, many weeks or months, especially if your property is unusual, commercial or in an area where demand is more limited. If all this is likely to take too long to complete then it’s time to look at option 2 – Refinance.[/ms_accordion_item] [ms_accordion_item title=”Refinance” icon=”fa-refresh” status=”close”]There are many refinance options to free you from your bridging loan, all of which will depend on your overall property strategy and plans for this property. Click for more information.

  • A wide selection of buy to let mortgage providers and products to help with your particular problems;
    • No six month rule for minimum ownership – lending on market value
    • Limited company applications
    • Trusts, offshore applicants etc
    • HMOs – lending on investment value (as a commercial)
    • Blocks of flats & flats over business premises
    • Semi-commercial properties
    • Properties with unusual construction
    • Lending into retirement age
  • Commercial Investment Finance
  • Whole of market selection of commercial lenders which means you get;
    • More flexible lending limits to 75% of Market Value
    • Limited company applications
    • Trusts, offshore applicants etc
    • All types of businesses and premises
    • Semi-commercial properties
    • Properties with unusual construction
    • Lending into retirement age
  • Business mortgage for an owner occupied business
  • Full whole of market access to the commercial lending market gets you a better outcome;
    • Up to 75% loan to value against market value for most business sectors.
    • Limited company, trusts, offshore or sole trader applicants
    • Less than three years accounts? Shorter minimum trading proof.
    • Semi-commercial properties
    • Properties with unusual construction
    • Succession planning help to extend term.
  • Refinance to a development loan
  • Full access to the development finance market to ensure you the best deal in the market;
    • Up to 100% of build costs funded.
    • Staged payments to help manage costs.
    • Expert funders to keep your build on track.
    • Residential and commercial developments funded.
    • Experienced or first time developers.
    • All sizes of development funded
  • Completed development finance – short term lending
  • Short term lending solutions to repay development finance using lower cost funding.
    • Rates from 0.64% per month.
    • Up to 75% loan to value based on finished project value.
    • Fast turnaround to limit interest paid on development loan.
    • Easy exit or part exit on property sales.
    • All sizes of development funded; single properties or large developments.
  • Move to another bridging loan.
  • There are a number of lenders in the bridging market who will look to take over a bridge which cannot be repaid on time;
    • Up to 24 months funding.
    • Option to service interest to achieve a better net loan to value.
    • Work with our finance experts to get back on track with the exit strategy. are able to advise on the best short term and long term finance solutions for your bridging loan exit plan. Please get in touch using the link below.

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