Understanding UK Bridging Finance

Bridging Finance Basics

Bridging finance, sometimes referred to as high speed property finance, is a ‘financial tool’ used to raise funds against the value of a property. These funds can be used for any legal purpose, maybe to purchase an other property or to raise capital for some other reason. Bridging finance is primarily for short term purposes – typically one or two months but can be for up to two years. Literally any residential or commercial property which has provable value can be used to secure a bridging loan.
Some of the main purposes to which bridging loans can be put:

  • Purchase of a residential or commercial property before the sale (or re-mortgage) of an existing property.
  • Purchase of a property where speed is essential to clinch the deal
  • Funding can be arranged for property in need of substantial repair or refurbishment pending a long term mortgage.
  • To avoid bankruptcy of other financial crisis by releasing the equity in a property.

Bridging loans can either be based on the “restricted sale value” of a property or the Open Market Value (OMV). The difference is simply down to the preference of an individual lender, a specialist commercial broker will be well aware of the difference and should ensure that this is made clear to the client.

Because the loan can be based on the Open Market Value of the property it is not at all unusual to see loans being arranged in excess of 100% of the purchase price. This is a major attraction to most property investors who are able to negotiate purchases well below market value. In the event that additional funds are required additional security can be used to “top-up” the loan.

How does it work?

A professionally prepared valuation report is the back-bone of a bridging loan. Most bridging loan applications undergo relatively few background checks on the client’s ability to repay the loan, therefore the lender has to rely on the valuation for their security. Most bridging lenders will have a preferred list of surveyors so it is best to leave arranging the valuation to your broker.

Whilst waiting for the valuation report the lender will usually carry out their statutory checks on the applicant and be ready to issue the formal offer documents or facility letter when the valuation has been completed.

The exact process will vary from lender to lender, but in most cases once the offer has been issued and the valuation report checked the case is handed over to the solicitors who will then conclude the matter.
It is vital that you obtain independent legal advice when arranging bridging finance. Your choice of solicitor will have considerable influence on how quickly the process can be completed. It is worth checking you local phone book for firms of solicitors who have a commercial department, these solicitors are mostly likely to have carried out this type of high speed transaction before. Most solicitors expect to take eight weeks or more to conclude property transactions, bridging finance is usually completed within two or three days of a satisfactory valuation report being received. (Obviously the author is not aiming any criticism at solicitors!)

Types of Bridging Loan

Whilst researching bridging finance you will come across the terms “closed bridge” and “open bridge”. In principle a closed bridge is where the ‘exit route’ or ‘repayment source’ is already arranged typically where contracts have been exchanged but the funds are not going to become available in time. On the other hand, “an open bridging loan” means that there is not a confirmed repayment method. As with most things financial, there is a grey area between the two. The most important things is to make sure you are arranging the right finance for your circumstances. This is where a specialist bridging finance broker is best placed to assist.

Bridging Finance in the UK

There are now more bridging finance lenders in the UK than there have ever been, so rates are coming down and terms are becoming more flexible. When dealing with a bridging finance broker do not be afraid of asking for the terms of the loan to be explained in plain English. You will often be quoted a broker fee and a lenders arrangement fee. The interest rates and any repayment charges should be made clear at the outset.

Financial Software Forex Trading in Online Business

Many people believe that starting an online business today is not practical due to the current economic state of the world. Nothing can be further from the truth. People experienced in business however, know that every crisis creates a good opportunity to earn profits. By using the financial software Forex trading, even an beginner businessmen can achieve great economic success in any online business.

Using a solid and proven financial software, any businessman will be able to generate the kind of profits that he ever dreamed of. Yes, will find a lot of “experts” who will be claiming that the Forex market is unstable. This maybe so. If you look at successful business people however you will see they can always find ways for profitability in the Forex business this is why this industry is extremely popular the world today. The secret is using the kind of software that assures easy operations in the business. This means that entrepreneurs should find a good financial software Forex trading to revolutionize his online trading business.

One of the main reason why you should consider using automatic Forex trading software because it can perform trading tasks even without any supervision. It can even run for 24 hours a day generating profit and will never gets tired or will complain. All you need to do is to configure the settings of the software to suit your needs and earning target.

Anyone who has been in the Forex trading you can imaging how expensive the cost of any downtime is. This is why if you are new in the business, then you need to get the financial software that works day and night. Businessmen will also find it very easy to use the financial software Forex trading because most it is designed to be used by business people, not programmers. A 24-hour customer support is also available to those who will be getting any problems using the software.

The Forex trade robot can also place your trading results on-line if you like. This potentially another revenue stream on how the Forex trader can earn more money. As your trading results become visible online, other people would want to use it and you can earn money through referrals.

Today’s businessmen can now use Financial Software Forex Trading is because of the advancement in the technology and reduction in price to use Forex trading robots today.

The fully automated software or Forex robots can do the trading for the business making online trading very easy and convenient. It handles all repetitive, but very important money-making tasks. Trading using forex robot will also save money from hiring people perform tasks for trading or marketing, accounting, and other operational tasks because the software can do most of these.