A bridging is very well known as bridging loan, swing loan, or even you can say it’s a short term loan, which is available from local lenders. This short term loan depends on different lenders. You can avail this loan for 12 months to 3 years. Sometimes, it is available for just couple of weeks. One of the most important things is that short term bridging loan is acquire at the very high interest rate. Apart from this feed, the most essential points is this kind of loan arranges finance at the short time and don’t need any formalities of documentation as compare to other bank procedure.
Important Feature of Bridging Loan
1. As we already mentioned this kind of bridge loan usually available at the high interest rate for short term. The interest rate of loan can be in between 12 % to 15% for the limited time of 12 months to three years. While, the local lenders charges 2 to 4 points additionally for long term loans.
2. This bridging loan is mainly available at two types. One is Open and other is closed. A closed loan is usually pre planned loan and the payment already define at the time of taking finances. There is no panned for closed bridge loan.
Bridging loan is very much useful in the area of real estate industry. It sorts your finance problem at the short time of span. These kinds of loan help in immediate arranging money to buy a property, which is available at the cheap rate. You can also take help from builders and the project developers. However, you have to be sure about the projects, because sometimes, projects never get approval and stay in pending status. So the developers offer their client to get bridge loan, which may be available at high rate of interest, but it will offer you help at the time of financial crisis.
You can use bridging loan in joint venture capital or in corporate finance. Bridging loan process is just like a gamble in your life; you may be a buyer of big property or can be a loser of small home, because lenders will take your home at mortgages, when you take money from the lenders. So this money plays an important and variety of role in the men’s life.
Bridging loans is equally risky for buyers and lenders. It has several terms and condition at the local lenders level. It also includes interest rates, fees and penalties. It’s small advice to take care all the things before going to choose for lenders in your local area. This is one of the useful steps to understand the market and use that money in the profits manners. Do small research from your side, so that if you have any query that will resolve at the time it occurs. You can go to renowned local lenders in the area. They will be helpful in managing money at short span of time.
