Sometimes you may be in a situation where you need funds quickly. Whether you're refurbishing a house or you have a business idea that needs funding right away, fast bridging loans can be a helpful option.

In this blog, we'll explore what they are and explain some steps you can take to speed up the process.

What are bridging loans?

Bridging loans are short-term funding options. They give you fast access to funds, allowing you to have more time to sort out a longer-term solution.

This option is useful in time-sensitive situations. For example, when you want to buy a new house but haven’t sold your current one.

These loans are secured against a property, which could be your existing one or a property you are buying. By doing this, it helps to reassure the lender, as they can repossess the property if you fail to repay your loan.

Whilst this option can be great if you need funding fast, the interest rates are usually higher than long-term solutions. Therefore, it’s good to consider this when you’re making decisions.

How quick is the process of getting a bridging loan?

It can be quick; however, it depends on how fast you and the lender move. Here’s an overview:

  • Initial application: You will need to provide some details about the loan and your background. This allows the lender or broker to gather key information about you and your situation. Whilst you can make an enquiry online, most lenders and brokers will need to talk to you over the phone to get a better understanding of your case.
  • Valuation and survey: The lender may need a valuation or survey of the property, to see its market value. Some lenders can use an automated valuation model, which means a physical review of the property will not be needed. This can make the process faster.
  • Credit check - Your credit history will be assessed to see if it is a risk lending to you. The lender will also look at your ability to repay the loan based on your income, employment status, and overall financial health.
  • Assessment and offer: If you meet the lender's criteria, you will get a loan offer outlining the terms and conditions. This includes the interest rate, loan term, and any other fees.
  • Documentation: Once you have accepted, you will need to gather the necessary documentation. This includes proof of identity, property documents, and any extra requirements for the lender. If you’re eager to speed up the process, it’s a good idea to have these documents ready in advance.
  • Get your funds: After the loan is finalised, the funds are released to you.

How to get a fast bridging loan

Getting a bridging loan quickly involves preparing in advance. Here are the steps you can take to speed up the process:

  • Research lenders: Look for trustworthy lenders and compare their interest rates, fees, and terms.
  • Gather necessary documents: Prepare all the documentation in advance. Common documents include proof of income, identification, and payslips. If you have this information ready to go, your lender or broker can get started on your application right away.
  • Speak with a financial advisor or mortgage broker: Getting professional advice can help you understand the requirements and identify the best lender for your situation. However, using a financial advisor or broker may mean you have to pay extra fees for the work they do.
  • Get a property valuation: Some lenders may need a valuation of your existing property. Having this valuation report ready can speed up the approval process.
  • Be honest about your situation: Make sure you accurately disclose all financial information to the lender. This will help the lender understand your eligibility and process your application faster. If you have hidden anything, these will get flagged when the lender checks your credit history and may cause delays.
  • Respond quickly to questions: If the lender asks for further information or needs extra documents, make sure you respond quickly to avoid delays.
  • Understand the terms and conditions: Before you agree to a loan, make sure you thoroughly read and understand the terms. This includes interest rates, repayment options, and any other fees.

Remember that while you may accelerate the process, getting this option can still take time. This can vary depending on the lender, your situation, and the complexity of the transaction.

Summary

Bridging loans can be a great option if you need fast access to funds. By preparing documents, conducting research, and being honest about your background, the process can be accelerated. However, it may still take time, depending on your circumstances and lender practices. Therefore, while these steps can speed up the process, you should approach the application with realistic expectations and consider getting professional advice for a smooth experience.

Think carefully before securing other debts against your home. Your home may be repossessed if you do not keep up repayments on a mortgage or any other debt secured on it.