Top 10 Finance – Bridging Loans

Top 10 Finance have been arranging bridging loans for many years, a bridging loan is a short-term loan secured by a property, it could be your existing home or another property that you wish to purchase, bridging finance could also be used to purchase  a property at auction, or a property that you need to purchase quickly. Bridging loans can only be used when buying property.

UK Bridging Lenders would look for security against the property as either a first or second charge and the rate of interest you would be charged would be dependent on the property location, the loan to value that you want to borrow against, also second charge loans are always more expensive than first charge loans due to the lender having to stand behind the lender who has a first charge in place. For first charge loans, the rate of interest could be as little as 0.37% per month for a person with a good credit rating, for a person with bad credit monthly interest rates could go as high as 1% per month.

Arrangement fees will also have to be taken into account and these are in the 1-2 % range depending on who the lender is. Administration fees are not charged on bridging loans except in exceptional circumstances.

Top 10 Finance – Development Finance

We have a specialist team arranging development loans for property developers, and can arrange loans for both inexperienced and also professional developers, if it’s your first project we can guide you through the application process to ensure you present your application in a professional way and so giving you the very best opportunity to get the funding you require. For experienced developers, we have a number of lenders looking to offer competitive lending terms for developers who have previously completed and sold more than 3 developments.

We work closely with specialist lenders in order to offer our clients finance that is at competitive rates and also fits in with their requirements. Interest rates can be as low as 4% p.a and we can source up to 90% of all costs including the initial site purchase. In addition, we have a number of joint venture lenders who would fund up to 100% of all costs, although in return they would also look to take at least half of the profit.

Development finance is secured against either land or a property that is to be developed and sold on for a profit. The loan would usually be drawn down against the initial purchase, be that land or a property that is to be refurbished or converted into multiple residential units. After the initial drawdown payments are made against works completed, based on a surveyors valuation. The loan would be paid back from the proceeds of the property sales, also a lender would expect to see 100% of the proceeds for each unit paid to them until the loan has been repaid, only after the loan has been paid back would you start to get your cash out of the development.

However, once the project is finished we could arrange an exit loan which would pay back the development finance lender and release cash for you, this finance is usually cheaper than a development loan and allows you to hold out for a better price without it eating too far into your profits.