If you are involved in property investment or development, you will be aware of how the speed of finance is a factor in the market.
A bargain may seem to appear from out of nowhere and can also disappear just as quickly. Moreover, to be as effective as possible, you need to be able to react rapidly in the market when an excellent deal is accessible to you.
To be ready to pounce on a great deal, you’ll need access to quick financing. Without adequate funding that you require whenever you need it, you will be forced to kiss goodbye to some great deals on the market.
Fortunately, bridging loans can give you the quick funds you will need to ensure not to have to miss out on a fantastic deal, that will yield the returns you anticipate.
Bridging finance is a surprisingly simple process. The financing you get is dependent on the value of one or more properties that you own.
Not only is bridging finance fast, but it also can be quite versatile. When it comes to interest rates and your repayment terms, you are going to be able to choose what is going to work best for your specific situation.
Because bridging loans are obtained quickly and with favourable conditions when finance is needed fast, bridging finance is a popular option among investors, landlords, homeowners, and specialists like property developers.
Why a Bridging Loan Broker
What is excellent about a bridging finance broker is the fact that they have contacts with many lenders and know the best prices in the market. They can compare the whole market and get the right deal for your specific conditions and needs.
Simply because you will not be tied to any specific institution, you’ll be able to explore the alternatives. Also, the broker is going to give you the very best options in the market.
Given that most brokers understand that they have to compete for your deal, this gives you leverage to negotiate and get the best possible terms.
Although the quantity you can receive from a bridging loan is according to the worth of a single or more property that you own, that doesn’t imply that you cannot borrow high Loan To Value, some lenders go up to 80% LTV even 100% Loan to cost.
When using a bridging loan broker, always remember to get alternative terms from them. Different bridging finance lenders use different evaluators for assigning value for your property or house.
With some lenders, they favour using an open market Worth. For others, the preferred approach is always to use a below market worth. You are going to have the ability to get alternative terms for bridging finance from different lenders through a broker. The broker should also understand who will give you the best bridging loan rate and borrowing amount.
Once you recognize which bridging finance broker you want to partner with, you are going to be capable of nailing down the right terms for your particular conditions and requirements.
Choosing the Right Bridging Loan Broker
- Make sure the broker has experience
- Choose a broker that works with many lenders in the market
- Check any credentials the broker may have
- Check reviews online such as google reviews or yell.com
- Ask what they have done before to get a loan for other people
- Check their website
- You must make sure they are easy to contact
- Understand the broker’s terms from the start
- Ask what fee they will charge
- Use a broker that charges fees on results only
Furthermore, the broker must negotiate fees and also the amount you would like; you can also review the interest rate and repayment terms for the financing, the broker should do all the negotiations on your behalf.
How Much Will a Broker Cost
Some brokers will not take a fee from you and will get their charge from the lender directly. Remember you are ultimately still paying for this. Others may charge a percentage of the loan amount; this is usually around 0.5% – 2% and some other may also charge you a nonrefundable fee to start the process.
The cheapest is not always the best, paying a little more to the right broker and he gets you more LTV or better rates, and better conditions will ultimately save you money.
So search around and discuss with different brokers your requirements and use the checklist above to find the right broker.
Each scenario is different, and the broker should be able to understand your conditions and take the time to review your details. The information will allow him to choose which lenders will have the appetite for your particular needs at the best possible rates.