You can rely on a bridging loan when you need money to bridge the interval between two transactions. For instance, a bridging loan can help you buy a new property while your old property is yet to sell.
You will encounter some costs and required criteria during your bridging loan application. As such, it is prudent to consider these factors before deciding whether a bridging loan is the best option for you. Below are some things to consider when applying for your bridging loan.
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Don’t Do These Things When Applying
Communicate Unclearly
Clear communication is essential to boost your bridging loan application’s chances of success. Consequently, be clear in all your interactions with your broker at every stage of your application. You can tell your broker about your situation and relevant past and current struggles. Transparent communication is vital because it simplifies the application process and makes it more effective.
Being Secretive
Honesty will likely get you the best terms when applying for your bridge loans. Consequently, prioritise being forthcoming with your broker during your application to boost your chances of getting favourable loan terms. It would help to be honest throughout the process, whether at the application, appraisal, or consultation stages. Also, tell your broker anything they might want to know, like your reason for borrowing and your true financial condition.
Poor Organisation
Some brokers may be reluctant to work with you if you are disorganised. Therefore, it is best to know all there is to know before proceeding with your application. As such, know the precise amount you will require, what you need it for, how you will repay your debt, and what type of securities you will need. Additionally, reach out to your lender to confirm whether you have finished your application appropriately.
Do These Things When Applying
In-depth Lender Research
You can get a wide range of bridge loans with varying terms and conditions on the market. For example, bridging loans from Finbri may have unique terms and conditions which may appeal to you more than others. Consequently, research the market to determine which brokers can get you the best lenders offering the right loans based on your needs.
Talk Through Exit Strategy
Your bridging loan’s effectiveness is restricted by its repayment plan. This plan is vital to the application process since it outlines how you intend to repay your loan rapidly. It is your loan’s exit strategy, and your broker needs it to reassure them that you can pay your debt.
Keep Your Mind Open
Brokers like learning everything worth knowing during loan applications, like your financial history and plans for the funds. Your answers can determine whether your application is successful or not, so be honest and take any advice you receive into consideration.
Understand Your Timelines
A practical timetable and cash flow are vital to paying back your bridging loans. These loans have limited terms, so decide when your loan and other expenses will be repaid with a bridging loan. A practical timetable helps you pay your loan on time, so think about this in advance in addition to whether you can complete work and repay your loan in a single year.
