Purchase of a business premises using a commercial bridging loan.
Businesses can use a commercial bridging loan to purchase a new property for business premises or as an investment. The bridging loan can be repaid when the property is sold or refinanced using a commercial mortgage. Many lenders now offer longer term solutions for bridging loan borrowers, refinancing the deal themselves at the end of the agreed term. This can be a more time efficient solution for the client. Bridging loans are faster to complete than commercial mortgages so allows businesses to respond quickly.
Bridging Loans for Developers
For developers who are likely to struggle to meet the lending criteria for a commercial mortgage, a bridging loan can be the answer. A major renovation project may appear too high risk for a commercial mortgage lender because they will have criteria to meet with regards to the types and condition of the property as well as the maximum loan to value that they will accept. Many developers use a commercial bridging loan to fund their refurbishment work. Once the work is complete a commercial mortgage is more likely to be deemed appropriate by the lender and the developer can switch if they wish. The loan can also be repaid by selling or leasing the property.