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Why bridging works

bridging finance Oct 25, 2019

Property investment tends to depend on you having worked hard to save a nest egg that will provide you with a deposit to buy your first property.  If you’re planning to get into property seriously, you’ll need cash for refurbs too.  Saving up takes time.

The challenge is that you need at least 25% of the cost of your chosen property as a deposit, in order to get a...

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Key bridging questions

bridging finance Oct 10, 2019

THE QUESTION

I'm new to the property investment world and looking to get my first buy-to-let.  I have two questions:

  1. If I buy with bridging loan and do a full refurb, can I remortgage earlier than six months?
  2. If I'm buying with bridging loan can I say that I'm a cash buyer or should I just say that I’m using a bridging loan?

THE ANSWERS

Question 1:  You have always been able...

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100% bridging loans

bridging finance Sep 09, 2019

THE QUESTION

I need to find a bridger where I can borrow 100% purchase price. The property is being sold  20% BMV.

THE ANSWER

No commercially minded bridger will lend 100% of all costs.  Why would they take all the risk and rely on the borrower to get it right?  Legitimately they may ask, what is the borrower’s incentive to get it right when they won’t suffer...

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"Cash buyers only"

bridging finance Aug 10, 2019

THE QUESTION

If an advertised (e.g. on RightMove) property says ‘cash buyers only’.  Could you use a bridging loan and still be considered.  If so, do you need to tell the agent/vendor you’re paying with a bridge?

THE ANSWER

Your understanding is correct; bridging is equivalent to cash for this type of property.  Cash buyer only properties are great to target if...

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Bridging finance for your main residence?

bridging finance Jul 10, 2019

THE QUESTION

Can you get bridging finance on a house you want to live in? 

I’ve found a 7-bed detached house that looks like it’s been converted into three flats - I suspect without planning permission as it’s advertised as ‘Cash buyers only’, 

I have some development experience and could afford it on my income with a mortgage when appropriate.  I...

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Could you be a ‘cash buyer’?

bridging finance May 30, 2019

Before you stop reading because you don’t think your bank balance is big enough to buy property for cash – STOP!

Have you noticed that cash buyers always get the best deals?  It’s those magic words “What discount will I get for cash?”  Whether that’s buying a car, a new washing machine or a suit, cash buyers often pay less. 

Unfortunately,...

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Fast Fluid Finance

bridging finance May 10, 2019

This is how to create a flow of cash from one project to the next as seamlessly as possible.

Bridging finance is a smart solution in many situations – but not all bridgers work the same way.  You need a bridger who will lend on the property’s VALUE, not what you are actually paying.

When it’s time to refinance, you will need to to convince the lender’s surveyor of...

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A sharp intake of breath

bridging finance Feb 28, 2019

I teach people smart funding and that means understanding how to use bridging finance to make more money.  The trouble is that as soon as I mention bridging there is almost always a sharp intake of breath!  This is usually followed by the words “Oh, that’s expensive, isn’t it?”

If you’re planning to use bridging to finance your main residence, yes it...

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The weakest link

bridging finance Oct 30, 2018

If you’re using bridging finance to give you more flexibility (and bigger profits) the weakest link is often the solicitor you choose to carry out conveyancing of your bridging loan.

I’m not about to denigrate solicitors as a profession, they are highly qualified individuals who perform an essential function.  They all have their specialisms and solicitors who are experienced...

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Commercial bridging to mortgage: what are the rules?

bridging finance Oct 20, 2018

THE QUESTION

If we use bridging to buy a commercial unit, does the six-month rule apply before we can apply for a mortgage?

THE ANSWER

This an ownership restriction, not a purchase restriction.

If a mortgage lender chooses to invoke a clause that says you must own the property for six months before they will accept an application to remortgage, then they apply it regardless.  It...

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