Watch the Video Below To Get a Better Grasp of What Bridging Means
In this video, Amram walks you through the ins and outs of bridging from a high level perspective. It explains what it is, how it works, and some of the things to consider prior to taking out a ‘bridge’.
This is not a term familiar to most, so let us break it down for you.
- What is Bridging Finance
- When should it be used?
- What are the chief advantages and disadvantages
What is Bridging Finance?
This type of finance, as the name suggests, is a short-term technique to get you from point A to Point B. To bridge the gap, so to speak, between the length of time it takes to secure conventional lending and the opportunity at hand.
Some investment opportunities can be time sensitive; for example, sellers could be looking for a fast sell to the highest bidder. Conventional types to lending can sometimes take to up 12 weeks to complete, which may not work. A bridging loan can help secure the opportunity until a long term solution is established.
When should it be used?
Ideally Bridging funds should only be used when you are faced with a great deal that you just can’t let get away. Your advisor at Amram will work with you to assess the needfulness of this type of financing, guiding you through the process step by step.
So lets talk about the good and bad sides of Bridging. The most obvious pro is that arranging bridging loans is relative quick. If all the boxes are checked the process can take around 14 days start to finish.
Like I said, a bridging loan is a vehicle to take you from one side of the road to the other… it is not the road you want to stay on longer than you have to. So one of the most important factors before getting into bridging is having an exit. At Amram Finance we plan the journey with you from the onset and will provide flexible exit opinions as part of our consultancy.
Another advantage of bridging is that you can secure lending for investments that may not be eligible or ready for long term finance options. What do I mean by that. well if you identify a property, lets say that is not quite habitable, or requires refurbishment, mortgage lenders will not be willing to finance. A bridge loan could help you get the funds you need to secure the property and do the required work that will then allow you to exit the bridge and get on to a more affordable longer term refinancing options.
Now for the down side, with every type of lending there is an element of risk. It is our job to ensure you know these risks and can properly mitigate them. We’ll explain the costs and charges involved with bridging, that make it a more expensive option. You’ll need to be sure that the cost associated with your bridging finance will be covered by the value your investment will gain and the exit you have arranged, either selling on or refinancing.
Amram can guide you through this process, what are you waiting for
Call us on 02045254876 to talk to one of our trusted advisors, alternatively email us at Info@amramfinance.com
Check out our website www.amramfinance.com for a link to our enquiry form.