I recently secured an extremely fast bridging loan for a couple’s main residence in order to raise funds towards a new business venture. My clients had an existing mortgage of £154,000 on their property, on which they were looking to consolidate and draw out additional funds. However, as they had an investment opportunity, they needed the funds in their bank account within just 2 weeks. This is nearly impossible for almost every lender.
Asides from the speed required, there were a few other challenges I faced with this case. Firstly, most high street lenders will not allow capital raising for a business at all, let alone within such a short time frame. Not only this, only one of the applicants had a source of income from his self-employment and he had not yet been working for a full year, which does not fit with the majority of lenders’ criteria. My clients also wanted the facility for a year because he had a very profitable business project coming up, which they intended to use the proceeds from to pay off the bridging loan. It was very important, therefore, to have no early repayment charges attached to the loan.
I knew that no conventional lender would be willing to accept this case, and even if they were happy to offer a second charge loan, it would prove too long a process for the quick schedule we were up against. Along with this, most lenders will charge over 1% a month for business purposes (if they even accept it in the first place).
Even still, I was able to source a specialist lender willing to accept the case, meaning I managed to have the whole amount drawn down in just 2 weeks. This came with the interest rolled up so there were no monthly payments, which at just 0.99% of the loan amount per month, was an extremely cost-effective way of securing the finance my clients needed until his business project paid off.
I secured a £220,000 loan at a rate of 0.99% a month, fixed for 1 year. My clients were delighted with this solution and we even continued to provide a full insurance review for them as well.