How Fast Can I Get a Bridging Loan?

Bridging loans are a type of short-term funding designed to meet the emergency needs of borrowers. They provide quick funding along with many other benefits, such as flexible eligibility criteria. However, the interest rate of bridging financing is higher than other types of borrowing, but it can help to resolve short-term financial issues. 

Some common situations where you can use bridging loans include purchasing a property before the sale of an existing one, buying a property at auction, or renovating a property before the sale to increase its value. Therefore, the need for bridging finance is quite pressing, but you may be thinking about how much you have to wait to get approval for this type of loan. 

Here in this article, we are going to explain how fast you can get a bridging loan. But first, you should understand whether it is the right option for you or not.

Is A Bridging Loan Right For You? 

You can take a bridging loan from direct bridging lenders, p2p lending platforms, or a broker. But before applying for bridging finance, it is essential to know if it is the right financing option for you or not. The interest rate is high, and costs rack up very quickly, making it an expensive way of borrowing. 

In the past, many advisors suggested that bridging loans was a creative solution for house purchases. However, it should only be used over a short period when you are waiting for long-term funding to become available. If you use it for anything else, you may end up purchasing something you can’t afford, leading to difficulties in repayments. 

Before exceeding the bridging loan, you will need to have an exit strategy and a backup plan. It will help you know where you will get the money to pay off the bridging loan and that you have a backup plan if your primary plan fails.  

Does It Take A Long Time To Approve?     

In many cases, bridging loans provide a perfect solution for individuals and businesses to move swiftly and take advantage of market situations, such as purchasing your dream property or property at auction. It is also useful when you want to keep the property but wait for the sale of your property to get funds. 

Bridging loans are only sometimes used in emergency situations. If you want to renovate a property and need funds for a short period, you can take help from bridging finance. In such situations, you are not desperate to receive funds within a matter of hours. 

Depending on several factors, a bridging loan can take a time between 72 hours to a couple of weeks to complete. It may take longer for finance to get approved because of its complexity, but lenders are very agile and expert in getting the information they need.   

ALSO READ: Small Bridging Loans Increasingly Popular Choice

What Factors Can Affect The Speed Of Bridging Loan? 

Numerous factors can affect the time taken to complete the bridging loan application process. Some lenders may take less time to complete the process than others.

There is usually a conflict between securing a short-term loan quickly and securing an affordable bridging loan interest rate. Like any other type of lending, the interest rate of bridging financing also depends on the level of risk to the lender that will affect repayments.      

The most significant thing that can affect the speed of bridging loans is the exit strategy. Most lenders are likely to accept your application if you have a plan on how you will repay the loan amount. 

If you have a valuable property to use as a security against the loan, you can get quick approval. 

Another thing that can delay your loan approval is the valuation of the property. Leaders send a thor party surveyor to visit the property and make a valuation report; it can take some days to complete this process. The same can be true for all the legal checks that can take time. 

In addition, your credit score is a determining factor. If you have a good credit rating, it is easier for you to qualify for a loan. 

All these factors can take a large amount of time to determine whether a borrower can repay the loan amount. Furthermore, they increase the risk to the lenders, which means you have to pay a higher interest rate. 

How Can You Manage To Complete The Process Quickly?

The bridging loan lender you choose or your broker can play an important role in ensuring that your application is completed quickly. So, it is always essential to choose a well-known and reputable lender. But there is so much that a borrower can do to ensure quick approval. 

When you make a bridging loan UK application, you should try to meet the general eligibility criteria so that most lenders are likely to accept your application. Always try to build a strong exit strategy to convince your lender that you can repay your loan amount on time. Other than that, keep all the documents ready such as proof of income, confirmation of ID and valuation report, so that you can instantly provide them to the lender. The required documents depend on the lender you choose and their eligibility criteria. 

In order to progress your application quickly, you should send back all the items quickly because any delays will prevent the progress of your application.          

    

Final Verdict  

Bridging loans are a useful and short-term funding solution designed to provide quick access to cash. Most lenders approve your application within 24 to 72 hours, but depending on borrowers' circumstances, it may take a long time. Suppose you have a good credit score, a valuable property, a viable exit strategy and a valuation report. In that case, you can get quick approval and access to funds to meet your financial obligations. However, it is essential to keep in mind that these are short-term loans. You should only take them for a time when you are waiting for your long-term funds to become available.