Bridging Finance Loan: How To Get One
A professional lending broker is most ideal when you consider getting a loan like
a bridging finance loan as it is quite a tedious and complicated process. Having a broker assures you that a skilled expert would be able to responsibly handle your application and processing of a bridging finance loan. While this is a quick and easy loan package, there are certain aspects in the application that would require expert handling.
The
bridging finance loan has two forms with distinct features. The first form is the closed bridging loan which is given for the purpose of acquiring new property even while waiting for the actual sale of an existing property of the borrower. The closed bridge form is appropriated when the borrower's existing property has already been agreed to be sold with a deed of sale instrument, even when no actual monetary exchange has taken place yet.
The lenders find this stage of transaction secure to the extent that they are already amenable to grant the loan as a contracted deal gives a high level of security for the loan already. While the close bridge form of loan is relatively easy to secure, it is advisable to still get the services of a professional broker to assure that the loan process is run smoothly.
The second form of loan is the open bridge form, which is a type of loan that has more complicated requirements and processes. In this type of bridging loan the services of a professional broker is absolutely necessary in assisting in the processing of this loan. In an open bridge form, a loan is processed to fund a new property for acquisition even before an existing property is even put forward for sale.
Since this is considered a heavy risk loan, the interest rates charged are considerably higher than the closed bridge form. This bridging loan also requires a lot of supporting documents and information to back up the loan. The lending company would definitely require information on the reasons for the purchase of new property, including an updated set of your financial accounts, a comprehensive and responsible plan on how you will make your loan repayments and an alternative strategy when the necessity of extending the loan repayment period arises.The open bridge form is a more tedious and difficult process because there is more financial risk involved on the part of the lending company, and understandably, this bridging loan form is less used and accessed by the public.
Both forms of loans have their own level of difficulty, and it is highly recommended that you get the services of a professional broker in going about these loans processes. Besides, having a broker would afford you better access to more loans products which would give you a wider array of loans options to be compatible to your financial requirements.
Bridging Finance Loan: How To Get One
By: Terro White
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