Bridging loans usually have a max LTV of 75%. However, some lenders offer 100% bridging loans under specific circumstances. There are 2 key ways to get a 100% bridging loan – by using another asset to provide extra security, or buying undervalue.
How much deposit do you need for a bridging loan?
The amount you will need to pay as deposit depends on the amount you want to borrow, the value of the property you are looking to purchase and the LTV (which is dictated by your lender). Your deposit will be at least 20% to 25%, as the LTV available on a bridging loan is 70% LTV or 75% LTV unregulated.
How much can I borrow bridging?
There are no upper limits on the amount of money you can borrow through bridging. The cap on your borrowing will be set by your situation and the lender involved. In some cases, very experienced developers are able to borrow 100% of their development costs as a bridging loan.
What is the criteria for a bridging loan?
Bridging lenders typically require collateral in the form of property. Loans can be secured on the value of one property for several combined properties. The lender and borrower will enter into an agreement whereby the service provider takes ownership of the property in the event that the loan is not repaid as agreed.
How quickly can you get a bridging loan?
Depending on various factors, a bridging loan can take anything from 72 hours to a couple of weeks to complete. It’s not the quickest type of finance to get approved due to its complexity, but lenders are typically expert and very agile in getting the information they need.
Are bridging loans dangerous?
What are the risks of a bridging loan? If you don’t sell your old house in time, you might not have the money you need to make your repayments in time. Since the lender has secured the loan against the property, there’s a risk of losing your home as fast as you got it.
How much interest would you pay on a bridging loan?
Bridging loans are known to charge a large number of fees in addition to the interest you’ll have to pay, including: An arrangement fee for the loan set-up. This is often 1-2% of the sum of the loan you borrow.
Who are the Somo family of bridging lenders?
SoMo is a 2nd generation family of bridging lenders. The team now boasts a combined experience of over 50 years in property lending. Our backgrounds range from accountancy, finance, insolvency practitioners, the legal profession (barristers and solicitors) and loan underwriting.
How many bridging loans has Somo underwritten?
The SoMo team has underwritten over £140,000,000 since inception in 2014. The company formed from a 2nd generation family of bridging lenders and now boasts experts from property, finance and legal backgrounds. The team has a combined 100+ years of lending experience.
How long has bridging loans been in business?
The company formed from a 2nd generation family of bridging lenders and now boasts experts from property, finance and legal backgrounds. The team has a combined 100+ years of lending experience. The team have been lending since 2014 and have a 100% recovery rate on all loans to date.
