Bridging – lowest cost, fastest completion - or both?
Steve Walker
Promise Money. Specialist mortgages, secured loans, commercial mortgages, bridging and development finance to Brokers, Introducers & Property Investors. Founder of Charity Promise Dreams. Helping terminally ill children
With bridging, each client will have a different set of priorities.
A recent survey tells us 44% of borrowers said speed was their main priority.
Whilst interest rate is an important factor, it can have less impact on short term borrowing whereas fees can have a greater affect on the overall cost of borrowing.
So it’s important to know your client’s priority at the outset.
Ultra fast - we have a lender which does same day legal completion and often avoids a valuation by visiting the property themselves.
We expect straight forward non regulated 1st charge bridging to completing within 5 days of the initial conversation
Fast – we offer a number of lenders with dual legal representation and a very slick back office process to turn cases around in a week or two
We know from frustrating experience that borrowers favoured local solicitors usually slow matters down – lack of pace and understanding of bridging – help us avoid this by prepping your client to use a specialist solicitor.
Rates and fees – these are secondary considerations when you need money fast and guaranteed. However fast doesn’t necessarily mean more expensive. A lender which has cheap legal costs and no valuation fees could work our far cheaper than the lender offering the lowest headline rate. That why you need an expert to compare the options and your clients priorities.
LTV’s – just as important as choosing a lender with a slick process is structuring the deal so it stacks up. Watch out for headline LTV’s (there are lenders offering 80% LTV but based on the 90 day valuation. 75% of the open market value may yield more. Also be prepared to throw other properties in to the pot – second charge loans on the main residence are available up to 125% LTV. Might this raise extra cash to get a different bridging deal – or even a different property?
Proactively getting involved – Understanding the client’s priorities at the outset, and getting them on board with the strategy is absolutely key. At Promise we offer to deal directly with the customer, lender and the solicitor, helping everyone through the draw down process for faster completions.
Actually we would recommend it – it frees up your time and yields better results.
Call: 01902 585052
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