VERSATILE BRIDGING
FINANCE

Our Bridging Specialist, William Edwards, has many years’ experience in the short-term mortgage market. Here he explains how bridging loans are increasingly being used as an alternative to traditional forms of finance and outlines how we’re well-placed to help with complex scenarios.

Why bridging finance?

Clients often use bridging finance to fix a broken property chain to guarantee they secure their next dream property, it allows them to access the funds to buy their new home before completing the sale of their previous property. They can be attractive as a quicker way to access funds, providing a viable exit strategy is in place. Bridging finance is usually in place for up to 12 months and the interest can be rolled up and repaid at the end of the loan.

Often, HNW clients can benefit from even greater levels of flexibility including a longer term of up to five years. 

In today’s increasingly complex market, there are many other scenarios where a bridging loan can be used, including:

• Buying a new home before selling – if your clients know what they want from their next property and don’t want to lose out on their dream home, bridging finance can put them in control as it allows them to purchase their new home before their existing property has sold.

• Raising funds for business purposes – bridging finance is a quick way of accessing funds. If your client requires an immediate cash injection to capitalise on a business opportunity, a bridging loan secured against their assets could be a viable solution.
• Re-bridging – clients with existing bridging finance may look for a re-bridge to secure a better deal or if their original loan is reaching the end of its term and they need more time before repaying. This may be because their planned sale fell through, or a build is taking longer to complete.

What are the acceptable repayment strategies?

Lenders consider a variety of practical repayment options. The exit strategy for a straightforward case could be selling an asset, security or investment. Refinancing is another option. In more complex cases, the repayment strategy could involve the sale of shares or overseas assets.

At Market Harborough Building Society we take a flexible approach and are happy to consider a combination of different repayment methods.

Award-winning solutions from THE bridging building society

We’re a bridging finance and complex case expert, with a wealth of experience under our belt. We were the first mutual to offer bridging finance and were named ‘Best Short-term Lender’ at the 2024 Financial Reporter Awards.

Offering solutions for regulated and unregulated cases, we recognise that client circumstances are becoming increasingly complicated and provide more than a one-size-fits-all approach. Our Credit Committee, chaired by our CEO, meets daily and always looks for ways to say ‘yes’ by assessing each case on its merits and never relying on computer-based decisions. This forms part of our Best for Brokers Promise, which is our commitment to putting the needs of brokers and their clients first, always.

Combined with a flexible approach, our bridging products are a compelling, alternative form of finance that can be used for more than fixing a chain break. With lending up to £5m, we cater for straightforward and complex cases with fixed and variable rates available up to 70% LTV. We also offer an interest roll-up facility for up to 12 months and up to 60 months for HNW clients.

Working in partnership – the key to success

As with traditional forms of finance, lenders and brokers must work in partnership to understand the finer details of the clients’ scenario.

For more information on our bridging finance solutions, click here or check out the guide below.