What Bridging Finance Is
Short term property finance designed around an immediate requirement and a defined exit.
A bridging loan is typically secured against property and used to bridge the period between an immediate funding need and a later event such as refinance, sale or completion of works.
It is generally suited to circumstances where timing or transaction structure makes conventional longer term funding difficult or inappropriate at the outset.
Typical Structure
Why Bridging Finance Is Used
Often used where the transaction cannot wait for a conventional route.
Auction & Time Sensitive Purchases
Speed matters, but understanding the purchase terms matters too.
Bridging finance is frequently considered where a property has been bought at auction or another purchase requires completion within a compressed timeframe. The finance should be considered alongside the contractual completion date, deposit requirements, valuation, legal work and the proposed exit.
Auction structures can vary, so the purchase method and associated costs should be understood before committing to the transaction or assuming that a particular funding route will be available.
The Exit Matters
A bridge should not be considered without understanding how it is expected to be repaid.
Speed can solve the immediate problem, but the strength of a bridging transaction usually depends on what happens afterwards. The proposed exit needs to be credible, achievable and consistent with the intended timeframe.
That may involve sale, refinance onto longer term borrowing, repayment from another defined source or a combination of events. The exit should form part of the structure before the initial funding is arranged.
What Lenders May Assess
The property matters, but so does the route out.
Our Role
Structure the bridge around both the entry and the exit.
The Aftersales Network Limited is a credit broker and not a lender. We assess the transaction, the property, the timing, the funding requirement and the proposed exit before identifying and positioning an appropriate route where suitable.
That means looking beyond how quickly the money can be arranged and considering whether the full transaction remains commercially workable from start to finish.
Due Diligence & Property Compliance
Speed does not remove the need to understand the property.
Title, valuation, planning, condition, intended use, works and relevant property compliance considerations can all influence whether a bridging structure is viable. Identifying potential issues early can be particularly important where the transaction is operating to a short completion timetable.
Understand some of the property factors that may influence a lender’s funding decision and the proposed exit.
Explore Property Due DiligenceExplore property compliance considerations that may become relevant to the asset, works or intended longer term use.
Explore Property ComplianceStrategic Funding Assessment
Start with what needs to happen now and how the bridge will end.
Tell us about the property, the immediate funding requirement, the timing and the proposed exit. We will consider whether bridging finance is an appropriate route or whether another property finance structure should be explored.
Related Property Routes
Explore other potentially appropriate property finance routes.
Next Step
Need short term property finance to move a transaction forward?
Complete our Strategic Funding Assessment and tell us what needs to happen, when it needs to happen and how the borrowing is expected to be repaid. We will consider the full property finance structure before deciding what should happen next.
