One of our Trusted Friends Affirmative Finance put a very interesting piece of information regarding Bridging Loans on there website. We have decided to share it with you.
A fast guide
When you take out a bridging loan it is important to consider how you will make your repayments.
These repayments are always made clear to you in your loan agreement. Although each agreement is different, there are a few common factors to be aware of. Let us explain.
How do you intend to raise the funds and pay off the loan? There are two main considerations.
First: A clear and concise approach improves your chances of securing that important loan.
Second: Unless specifically agreed in advance, the maximum term you can expect is 18 months (from Affirmative). Other bridging companies only have the ability to offer 12 months as a maximum term.
So right from the time of your application, it is important to have a clear idea of how you are going to repay.
Example: sale of a property
Key factors to consider:
- Do you intend to market the property with local agents?
- Have you received advice as to how long the marketing process will take?
- Do you have evidence to support your assumptions of the end value if you are refurbishing or developing the property?
- Do you have a buyer lined up and if so how quickly can they proceed?
- Are you placing the property into an auction?
Remember to add time as a contingency plan for unexpected delays.
Interest and monthly payments
Some bridging loans are structured so that the borrower pays interest each month. But other structures, such as retained interest, allow you to deal with the interest as a part of the loan:
Rates typically start from 1% per month.
For example: If you borrow £250,000 at a rate of 1%, you would pay £2,500 in interest a month.
To help you meet payments we can retain monthly interest from the loan.
For example: A £100,000 loan with interest at 1% would be £12,000 interest over a 12 month period. Retaining that from the loan would give you £88,000 on completion of the loan transaction.
Find more information about interest payments copy the link below to take you to their page www.affirmativefinance.co.uk/blog/how-do-i-repay-a-bridging-loan/
How do I apply?
Read over the products and costs, then make a free application. You can borrow £10,000 to £5 million. LTV rates up to 75%. Interest rates from 1% per month. Our record is four hours from start to finish.
For more information call their Manchester office today on 08701 123 111.
We hope you find the information above useful and would also like to add
Taylor Wilkinson Surveyors Ltd has more than 250 Surveyors now nationally, so if your looking for a Surveyor give us a call on
0845 463 8979 for more details
If you prefer to contact direct call Geraldine on 07828989477 or Marion on 07885 543 428