CAN YOU GET 100% BRIDGING FINANCE?

Is there any loan that covers the whole property value? Every borrower asks the same question. The answer is simple. 

A bridging loan containing 100% LTV can cover the property value you want to buy. It’s hard to get such a loan; nonetheless, it will be a dream come true if it happens to you. 

Most bridging lenders provide 75% bridging loans as an industry standard. However, you can still create a room for a 100% LTV. 

To make it happen, you should follow a certain process. We have gathered the right information in this article. 

Is it possible to get a 100% Bridging Loan?

Yes. You can get a 100% LTV on a bridging loan for your property purchase. It implies that the lender will give you all the money equal to your property value. 

It seems rare in the bridge lending industry because lenders choose to set a standard for property loans. They usually fall between 75% to 85% loan-to-value ratio. In other words, banks only cover 75% of house-buying costs. 

That said, there are certain ways you can make that loan LTV 100%. You will explore this later in this article. 

How to get a 100% Bridging Loan?

Borrowers who seek mortgages to buy a house face the difficulty of prolonged application approval. It deeply reduces their ability to purchase the property because there are many big players in the market. 

So, to keep everything quick, you want instant loan approval. As in the case of bridging loans, people usually don’t get the 100% value of the house, which again puts stress on your pocket because you have to pay a chunk of the property price from your pocket. 

However, there are two ways to cover the 100% value of your loan. Let’s discuss both of them below.

Purchasing below the Real Value:

The housing market is replete with market bubbles that sometimes inflate and makes the prices overprice. However, there is still room for negotiation when it comes to the pricing of a property. 

With proper planning and negotiation skills, you can lower the property price a bit and make a deal with the seller.

There can be many scenarios to make it happen. Maybe you offer the seller to pay the lump sum in a few days, or the seller is desperate to sell their house. 

You can grab the opportunity and request to lower the price in these cases. Purchasing a property of less value allows you to cover all the purchasing expenses in a bridging loan. 

Even if the lender gives LTV loan lower than 100%, you are good to go, as you have already covered the price. 

Employing Bridging Broker:

Bridge lending brokers are astute and clever enough to deal with many lenders. They have vast market experience as much as they know how different lending firms work and what products they offer. 

Even they know some exclusive bridging finance the companies do not offer individuals. Moreover, they can reach out to the lenders on your behalf and create a special product for you. 

Therefore, meeting a bridging broker and discussing your loan requirements may help you get a 100% bridging loan. 

Using Extra Security:

Extra security can be a better option but only for those who own multiple properties. You may have different properties if you are in the property business. 

Remember, the lender lowers the LTV% to make the loan risk-averse. So, if you are able to offer an additional property, lenders will feel confident to lend more money. 

They may also feel that the loan is less risky, and their side gets covered with adequate collateral. It makes the perfect loan equation for the lender and borrower. So, in return, the lender will take no pains in providing you with a 100% LTV loan. 

Final Words:

Bridging loans are the most popular type of specialised finance business and property owners alike. Although it has a diverse loan bracket, it mainly covers property finance. 

If we narrow down the property sector, the most important use of bridging finance is the house/property purchase. 

Whether the property is residential or commercial, you can use these loans to move fast with the money. Actually, it bridges your financial gaps in lesser time than a mortgage. 

Therefore, in 2022, the major purpose of getting a bridging loan was none other than a chain break. You can use bridging finance to avoid putting your property in long chains. 

In the way of securing a loan, the lower LTV value may cause trouble with your finances. Sometimes, you may require more money to cover the value of the house you are purchasing. 

Since you don’t have money to add to the loan amount to buy the property, so you would like to seek 100% bridging finance. 

This article explains the contours of 100% bridging loans and how to get one. We hope you get the right information you want after reading this article. Anyhow, if you have gone through it, let us know your feedback in the comments.