Our Flexible Bridging Loans Help to Keep Your Business Goals On-Track

Although bridging loans can be arranged fast, and often much quicker than a commercial mortgage, it can still take several days and possibly up to several weeks to finalize.  With bridging loans being secured against your tangible business assets, it depends how quickly a valuation of the assets the loan is to be secured against can be arranged and completed.

If you are not certain if a bridging loan is right for your Company, what other options do you have?

Remortgage

Where you have built up adequate equity on your current business mortgage, you could consider remortgaging as a way to release the funds you need.  You should be able to remortgage with your current lender or consider switching to an alternative lender and increase your mortgage to release cash that can be used elsewhere within your business.  Remortgaging can sometimes be advantageous should you be able to find a lower mortgage rate.

Second Mortgage

If you feel that on this occasion, a bridging loan isn't right for your business you could consider getting an additional, second mortgage.  Second mortgages are secured against the equity (or capital) already built up within the first mortgage.

All businesses needs to explore all viable options when it comes to deciding the best way to gain access to finance.  This type of business finance comes with pro's and con's. One of the main risks is that this type of loan is secured against pre-existing business assets that will be lost should your business struggle to repay its financial commitments relating to loan repayment. 

If your business has CCJ's or recent defaults on repayments you should seek to repay these ASAP as they can restrict your ability to gain access to finance; having said that you may still be granted access to a bridging loan subject to terms and conditions and adequate security for the loan to be secured against.  If your business has a bad credit profile then you should explore ways to improve your credit rating before considering other types of credit. Some lenders might be more keen to lend to companies with bad credit providing there are sufficient assets that can be recovered should you default; for this reason, you should think carefully before applying for a bridging loan because you could lose the assets your business already owns.

Any business needs to think carefully when applying for commercial finance to ensure it makes the best decision it can at any given time.

Will you pay variable or fixed rates?

Your Company can choose between paying fixed or variable rates.  Variable rates can fluctuate from month to month in line with market trends and fluctuations.  Variable rates can be problematic as you may never have a clear picture of what your repayment amounts will be and how much your interest rates will be.  Fixed rates, on the other hand, provide additional security in that you will know exactly how much your repayment amounts are month on month.  This means that you may be able to plan more effectively reducing the chances of being caught out by differing repayment amounts as with variable rate loans.

Is this type of business loan a first or second charge loan?

Second charge loans are for when you already have a loan secured against an existing mortgage with outstanding repayments on it.  If you are seeking to make improvements or renovations to a commercial property you would need to take out a second charge bridging loan.  In simple terms, 1st and 2nd charge mortgages are just an efficient way of writing down in what order prior loan providers get repaid should your business be unable to repay the loan before the end of the agreed term.