BEL Global Trust Bank agree with CML on Bridging
11 February 2008
The Council of Mortgage Lenders (CML) recently endorsed bridging loans as ‘useful in the short term’, stating that they are often ‘the best route to follow if there is a difference between timings of the purchase and sale’.
BEL Global Trust Bank, who specialise in intelligent and flexible finance solutions for residential and commercial property developers, echo this sentiment and also agree with the CML that a clear exit strategy should always be in place before anyone agrees to the terms, as bridging loans can be subject to higher rates of interest.
When a chain breaks it is frustrating for both vendors and sellers. Kick-starting a chain-bound purchase in a slowing market is even more challenging. Creativity within the boundaries of the traditional lending process is essential if opportunities are not to be missed in the current climate.
When it comes to creative finance solutions, bridging loans can provide the flexibility to enable a purchase or sale. Bridging loans do exactly what the name suggests, they bridge the gap in the purchaser’s finances. Bridging is a quick, short-term finance solution that can facilitate the completion of a purchase before a long-term finance solution can be found. Bridging can help to mend a broken chain.
BEL Global Trust Bank are experts in property finance and can deliver bespoke bridging finance quickly to borrowers to enable the sale to complete with speed.
However, the decision to obtain a bridging loan must not be taken lightly and should only be utilised when there are sufficient funds on the other side of the monetary void. This could be the agreement of a long-term mortgage, an insurance policy maturing, a sale being completed or perhaps an inheritance being received. In these circumstances bridging finance to secure a new property purchase can be a beneficial solution.