In this article, we explain the different circumstances where bridging loans might be necessary.
If you are considering a bridging loan, it pays to consult a professional adviser as well as discuss this with your solicitor who is handling your Conveyancing Gloucester way such as https://www.deeandgriffin.co.uk/services/conveyancing/
Keeping a place in a chain
When the purchase of a property is funded out of the proceeds of another property’s sale, but the sale can’t be completed at the same time as, or before, the purchase, you might need bridging finance.
Renovating, converting or restoring properties
Frequently, property is deemed to be unsuitable for a mortgage. This is generally due to poor condition, or because the property lacks a bathroom or kitchen. Bridging finance may be secured against such property. This helps landlords who want to renovate and then sell or rent out properties.
Buying an auction property
If you win at auction, a 10 per cent deposit is typically paid that day, with the remainder of the money due within 28 days. Bridging loans can be put in place quickly, guaranteeing that sales can complete in time.
Solving short-term cash-flow problems
Cash-flow problems can occur for various reasons in business. A bank might call in your overdraft facility, customers may pay invoices late, or brand new equipment may be required unexpectedly.