Refinancing a bridging loan

Refinancing a bridging loan is an important consideration. Whether you’re looking to complete a transaction in a hurry, or need to buy a property before selling your previous home, a bridge loan can be arranged quickly and with minimal fuss.

Bridging is certainly not as cheap as residential finance, but bridge loan rates have decreased significantly in recent years as the market becomes more competitive.

Additionally, because they are only intended to work as short term loans, you may need to consider refinancing your bridging loan once the term is up—usually within twelve months. Of course, this isn’t always necessary; if you took out a bridging loan to cover a gap in finances before selling a property, you could simply pay off the bridging loan with the proceeds of the property sale.

But sometimes, problems crop up, meaning you are unable to pay your bridging loan off straightaway. You may also have taken out a bridging loan because you needed a very quick solution. As such, you may still want property finance once the bridging term is up—but would prefer to be on a conventional term finance facility. The Enness Bridging team work closely across the Enness group (which includes commercial, development, international and residential finance arms) so we can confidently advise you when it comes to refinancing a bridging loan.

In some circumstances, you may even wish to refinance onto another short term loan. We regularly assist clients who need to refinance from a bridging loan onto another bridging loan, perhaps because a transaction has taken marginally longer than expected—i.e., a property sale set to complete within twelve months has turned out to be more like thirteen. In these instances, it may well be appropriate to refinance from a bridge, onto another bridge.

Some lenders can be reticent about this, as bridging finance is meant to be a short term loan, not a continually rolling facility. However, a good broker will be able to negotiate for you, showing you do have a suitable exit strategy in place.

Whatever your situation is, the Enness Bridging term will secure you the best bridging loan rates. We’ll always carefully consider your unique situation to advise you on the best course of action.