(PRWEB UK) 16 November 2012
Within the past few months, there has been a rise in the number of people taking out bridging loans. This market trend has come about due to a number of reasons and changes in the bridging loan industry. These changes and adaptations have happened over time and changed the way the industry works today.
First, What is a bridging loan?
Bridging loans are short term financing options that can supply a person with access to immediate funds. They are most often used when buying and selling property as they can be used for large amounts of money and the whole process can be completed quickly. Bridging Loans thought we would look in to why so many people are now taking out bridging loans and this is what we found:
Increased Variety- There has been an increase in the types of bridging loans available
As more needs have arose, more types of bridging loans have become available.There are a variety of different bridging loans out there. Most bridging loan providers will supply a variety of different bridging financing options. Common types of bridging loans include open bridging loans, closed bridging loans, residential bridging loans, land bridging loans and more. The wide selection available is what so many people find appealing about bridging finance. With a wide scope of options available, there’s a kind of bridging loan for almost any requirement. This means that people can turn to bridging finance providers as opposed to high street banks or other lenders when they need their funds. With all the high street banks offering limited packages, this has helped bridging loans prosper.
Easier Applications - The application process for bridging loans has been refined to be simpler
Unlike a lot of other lending options, the application process for getting bridging finance is relatively simple. In most cases in order to begin proceedings with a bridging loans application, all you need to do is fill out an online form. There’s no need for faxing of paperwork, or lengthy phone calls. This is one factor that has lead to so many people taking out these loans because nobody really wants to spend their valuable time filling out forms, faxing documents or engaging in lengthy phone conversations with a company.
Faster Applications - Recently, bridging loan applications and deposits have been sped up
Once a bridging loan application has been submitted, the rest of the process is extremely quick. In more or less all cases, it’s a matter of minutes before getting a decision on a bridging loan. After all this has been confirmed, in some cases the money could be in the borrowers account within a few days. Failing this, there’s usually a period of 2 – 4 weeks. This is still a much faster process than if someone had to rely on the high street banks. When people apply for credit, they usually do so because of a need for cash and when this is the case, it’s so useful to have such quick options for obtaining bridging finance. This is another reason why my people are using bridging loans.
The Amount That Can Be Borrowed Has Risen - As interest rose, so did the amount that can be borrowed
Due to bridging finance usually being taken out for purchase, renovation or relocation of a property or business, there is usually quite a lot of money that can be borrowed. The exact amount differs from lender to lender and based on the property that the borrower is using as security. Bridging loans are the fastest, easiest and most reliable way of gaining instant funding of such high amounts of money, which is one reason as to why so many people are taking out bridging finance.
Doesn't Rely On Credit History - Bridging loans broke away from the usual credit checks lenders would carry out
Everyone has a credit history. This is a report detailing a person’s credit history in terms of where they've missed payments and how many they missed. It’s an indication to a lot of lenders how reliable a prospective borrower is based on their past credit history. When taking out bridging loans, it doesn't matter what a person’s credit history is like. This is because a property of some kind has to be used as security against the loan. The value of the bridging loan usually equates to just under the value of the property the borrower is using as security. This is to ensure the safety of the lenders so they’re not lending out their money to not get it repaid. If the security property’s value is higher than the loan value, the lender would still make a profit if the borrower failed to make repayments and the lender sold their property. With banks cracking down on their lending, more and more people are turning to bridging loans.
Short Time Frame - Market trends indicate people love shorter time frames for bridging loans
When it comes to finance, people generally don’t like long term contracts. This is where bridging loans stand out against other options. When taking out bridging finance, there are no long term contracts as the money is usually paid back within a short time frame. This is because most bridging loans are taken out to bridge the gap between buying a new property and selling an old one. The loan would be repaid upon completion of the sale of the borrower’s property. Exact time frames differ slightly between the different types of bridging loans, although generally they are short term financing options. For example, a closed bridging loan has a slightly different time frame than an open one.
Company Summary - A summary of Canon Finance Ltd
Canon Finance Ltd are specialists within the bridging loan industry. They take a unique transparent approach to lending and their customer relations. This is why they took it upon themselves to formally answer this question, which they were being asked time and time again by customers. Working in the competitive bridging loan industry has taught Bridging-Loans.com a lot about how to look after their customers and source the best bespoke bridging finance options of them.