Can I use a bridging loan to purchase at auction?

Yes, you can use a bridging loan to purchase at auction. And there has rarely been a better time to do it.

It seems more people are turning to auction houses to sell their properties which means a heightened chance of properties being purchased under market value, creating a promised land for buy to let landlords, which many have been taking advantage of.

We have also seen a noticeable uplift in the number of bridging finance lenders offering specific solutions for buying at auction.

Undoubtedly a thrilling experience, buying at auction is also riddled with uncertainty. You are required to pay for your property typically within 28 working days, something which can often be difficult, especially without a bridging loan to plug the financial stop-gap whilst capital is raised. We know that time is of the essence and a mainstream mortgage will simply not do.

At Enness, we have a proven track record when it comes to negotiating auction finance for our clients when it is needed most. Our process will be:

  • Understand your circumstances and what you are planning to bid on at auction.
  • Can we raise funds in time against your current assets – Bridging Finance has its uses but it will be cheaper if you can use mainstream finance to fund your purchase.
  • Or, should we at least raise your deposit or a hunting fund – an offset mortgage or draw down facility against your home for example.
  • Next, we will seek a pre-approved credit line, based on expected parameters, so that you can bid with confidence.
  • at the same time we will pre-plan the auction finance exit so that you can move to mainstream finance, if appropriate as soon as possible.

Of course – if you are reading this and you have already been successful at auction, congratulations, and we will of course still be able to arrange the correct bridging finance for you in time. We will be more successful however if you call us now!

 

No Valuation Bridging Loan for Auction Purchases

Further, our latest partnership with a specialist bridging lender allows us to promote the ‘No Valuation Bridging Loan’, now giving our clients financial peace of mind even before the hammer falls.

The No Valuation Bridging Loan is specifically designed to adapt to the fast-paced world of auctions, requiring no valuation of the property before a loan is granted. A testament to just how attractive and successful this market has become.

The terms of the loan are as follows.

  • The max loan amount is £1.5million.
  • The max loan-to-value (LTV) is 65%.
  • Interest rates start at 0.65% and 0.85% for residential and commercial respectively.
  • The lender pays for a valuation of the property after completion.
  • Deals are conducted on a case by case basis.
  • 3 months minimum term.
  • Lender agrees an estimated valuation of the property pre-auction to secure a comfortable bidding limit for added peace of mind.

In the competitive auction property market, peace of mind regarding your ability to follow through with your purchase may mean the difference between acquisition and non-acquisition.

Enness brokers offer assistance at every step of the way. Using our No Valuation Bridging loan gives our clients an edge over others.

Bridging loans are a vital tool when acquiring property through auction-houses. The increased popularity of property auctions, which has led some to suggest a boom in the market, has only amplified the need for clients to have the best bridging loans in place and as large an advantageous position as is possible before even crossing the auction house threshold.

At Enness, this is what we offer, if you would like to know more about our bridging services in relation to auctions or any other product, please do not hesitate to get in touch.

 

 

 

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