Commercial Bridging Loans UK

Commercial Bridging Loans UK

Commercial bridging loans are popular among both local lenders and borrowers. Though previously mainly a preserve of private lenders, it is now gaining popularity even among major high-street banks. This is an effective financing support when you need some bridging funds but you must be very careful while seeking this source of funding.

Commercial Bridging Loans in the UK generally bear interest rates that are relatively higher. When the loan repayments are not made as per the agreement or contract, the interest will keep on adding up.

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Reasons for Popularity

Things to Be Aware of

  • A key factor contributing to the rise of commercial bridging loans is the nature of immediacy. Within a couple of hours or days, your loan gets approved and the money is credited into your account. This speedy process gives bridging loans an edge over the standard bank credit during critical times.
  • The access to bridging loans is now wide; from private lenders, to investors and banks, all are lining up to offer you funding.

Conclusion

  • Bridging commercial loans UK should not be viewed as an alternative to seeking mainstream funding but more of a useful tool to meet an urgent financing need, a stop gap measure.
  • Typically, you get charged a late payment penalty of 3% or more. If not paid in a timely manner, these penalties could accumulate and easily could get you deeper into a financial hole.
  • Always think and plan about your loan exit strategy. You may want to consider seeking mainstream funding, which though takes longer to get approved, will provide you with the money to clear your commercial bridging loan sooner.

Commercial bridging loans UK are increasingly becoming an essential player in the financing arena. Whilst still relatively small and a niche product in the UK, it is filling an essential financing gap, without which a commercial opportunity would otherwise be lost!