A major benefit of bridging finance is that a borrower can have the loan funds available much more quickly than with most conventional loans, but how soon is it possible?
The initial loan decision
When you contact a bridging finance broker, after the initial discussion about the loan application, the broker will approach one or more lenders. The initial decision to approve a loan application will usually happen in less than a day. With some lenders, the initial decisions can take just a few minutes.
The speed of the application process
After the initial decision, there are many processes that must happen before the loan funds become available. If property is used as security for the loan, it must be valued. The borrower needs to provide documents to prove their identity and financial status, and there is legal work involved too.
After the initial loan decision, a formal loan offer can take between one and two weeks, and the loan amount available within two to four weeks. This is usually a lot more quickly than with a standard mortgage.
What can I do if I want the money in less time?
For some situations, even two weeks is too long, and many people require a bridging loan for time sensitive deals; for example, a building purchase may need to be completed quickly to prevent a cash buyer from buying it. A business may need bridging finance to provide funds to purchase high volumes of stock that are offered at a large discount for a brief time only.
There are several ways to speed up the bridging loan process. Your usual solicitor may not be the best person for the legal work, but a solicitor who is an expert on bridging loans may be able to perform the legal work much more quickly if you need a faster completion. They will be able to work with the bridging finance lender’s legal team to make sure that they do not delay their legal work.
If property is being used as security for the loan and it has had a recent surveyors’ report then the valuer may not need to visit the building to complete a valuation report, and this will save time.
A mortgage broker can assist the borrower in preparing the correct documents to support their loan application. The broker can check the documents for accuracy. If there are errors in documents, then this can delay the completion of the loan because documents will need to be returned for corrections.
How quick is quick?
It the lender knows that you are in a hurry, it is possible to complete the bridging loan application process in 7 days or less. In exceptional circumstances, loans have been completed within 24 hours.
If you require a bridging loan, talk to Ascot Mortgages today. If you need the money quickly then discuss this one of our bridging loan experts, who will be able to advise you on how the process can be speeded up.