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Three Key Factors to Consider When Applying for Bridging Finance

Making the decision to apply for a bridging loan is something that requires careful planning and forethought. As with all financial products, a bridging loan is a form of debt that should not be taken on without first considering the ups and downs of bridging finance.

If you decide that a bridging loan is for you, there are three main factors to consider during the application process. Or more specifically, three equally important matters to prioritise, in order to ensure you get the best possible deal.

1.  Extensive Research and Expert Advice

You will need to build a detailed understanding of how bridging finance works, in order to determine whether or not it is for you. Bridging finance is a strictly short-term facility, with loan terms available from 1 to 24 months.

The size of the loan you need coupled with your preferred repayment term will play a major role in determining the product’s rate of interest and borrowing costs. As will the value of the assets you plan to use as security for the loan, and the strength of the case you present to your lender in general.

Enlisting independent broker support at the earliest possible stage is therefore essential. Your broker will help determine whether a bridging loan is right for you, while providing the assistance you need to put together a convincing application.

2.  Carefully Consider Your Exit Strategy

Nothing matters more than a viable exit strategy – i.e. a concrete plan to repay the loan within a specific timeframe. A bridging loan can be repaid in any number of ways, but most exit strategies fall within one of the following three brackets:

  1. Using money you are owed but have not yet received
  2. Selling a property and using the funds to repay the loan
  3. Refinancing onto a longer-term loan for gradual repayment

The strength and viability of your exit strategy will play a major role in determining your eligibility for bridging finance. Your job is to convince your lender that come what may, they will receive their money back in full and on time.

Again, this is something your broker will help you with, in terms of both assessing your exit strategy and presenting it to your lender in a convincing way.

3.  Evaluate the Alternative Options Available

There is rarely any instance where bridging loans are the best viable option available. However urgent or complex your requirements may be, there will always be alternative options to consider.

During your initial consultation, your broker will present you with these options and explain their defining characteristics. You will be provided with the independent expert advice you need to make the right choice, irrespective of whether or not a bridging loan is for you.

From specialist development finance to secured business loans to credit cards to personal loans, all available options should be considered before making your final decision.

Craig Upton
Craig Upton supports UK businesses by increasing sales growth using various marketing solutions online. Creating strategic partnerships and keen focus to detail, Craig equips websites with the right tools to rank in organic search. Craig is also the CEO of iCONQUER, a UK based SEO Firm and has been working in the digital marketing arena for many years. A trusted SEO consultant and trainer, Craig has worked with British brands such as, and Bridging Finance. Craig has also supported UK doctors, solicitors and property developers to gain more exposure online. Craig has gained a wealth of knowledge using Google and is committed to creating new opportunities and partnerships.

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