The beauty of bespoke bridging finance lies in its flexibility. Unlike a conventional mortgage or property loan, a bridging loan can be used for any legal purpose whatsoever.
Contrary to popular belief, the appeal of bridging finance is not limited exclusively to established investors and developers. From everyday households to small business owners to aspiring buy-to-let landlords, affordable bridging finance is helping borrowers from all backgrounds achieve their goals.
With this in mind, here are four of the most popular applications for bridging loans in 2022:
- Refurbishments and Conversions
As property prices continue hovering at record-high, house-flipping is becoming an increasingly lucrative venture. Conducting renovations and refurbishments prior to selling a home holds the key to generating the biggest possible profits. Major renovations like conversions and extensions can be particularly profitable, calling for short-term funding to cover the costs of the improvements. Designed to be repaid within a few months, bridging finance can be a uniquely flexible and affordable facility for these kinds of projects.
- Repurposing Buildings
The same is also true with building repurposing – i.e. where the nature and purpose of a building is altered to enhance its appeal. The most common example of this kind of project is taking a commercial (or semi-commercial) property and transforming it into a series of residential dwellings. Securing finance to fund projects like these can be a challenge, as most lenders are willing to lend against ‘nonstandard’ or ‘unmortgageable’ properties. By contrast, specialist bridging loan providers will issue loans against any type of property, irrespective of its condition.
- Buying a Home While Avoiding Property Chains
One of the best ways of avoiding a potential chain-break scenario is to turn yourself into a cash buyer. This is precisely what bridging finance can do, providing homeowners with the instant-access capital they need to buy their next home. After which, the loan is repaid several months down the line when their previous home is sold for its full market value. For those who have sufficient equity in their current homes, buying a house with a bridging loan can be much quicker and easier than the traditional approach.
- Financing Business Ventures
Getting a new business venture off the ground can be a costly process. It can also be a project rife with unexpected costs and cash flow issues, calling for affordable short-time finance to keep the business afloat. Sadly, most High Street banks and lenders are unwilling to support businesses that cannot provide at least two years of accounts or tax returns. As this is not an option for new businesses, flexible bridging finance is a better option. Bridging loans can be secured against a wide variety of assets, ranging from residential property to business premises to vehicles and other assets of value.
For more information on the benefits of bridging loans or to discuss your requirements in more detail, call anytime for an obligation-free consultation.
