Who can apply for a bridging loan?
Anyone can apply for a Bridging loan with Together, including:
If you’re self-employed
Whether you’re a sole trader, freelancer or side-hustler, we can accept self-employed applicants with just 12 months trading history, and you’ll get the same rates as someone with a regular income.
We’ll look at your last three months’ earnings, so even if you took advantage of the Self-Employed Income Support Scheme in 2020, you’ll still be considered. If you’re applying for a Personal Bridging loan with Together, we won’t need to complete any affordability checks, as you won’t need to make any monthly payments.
If you’re retired
We’ve no maximum age on our Commercial Bridging loans, and our maximum age for our Personal Bridging loans is 85 years at the end of term. We’ll consider a wide range of income (including your pension) when it comes to assessing affordability.
So if you’ve found the perfect retirement property, you don’t need to wait around for your current one to sell, and you’ll have plenty of time to organise your move and make the transition gradually.
If you’ve got adverse credit
If you’ve got less-than-perfect credit, such as a small blip that’s caused a big impact on your credit score – we’ll use our common sense when reviewing your application, and look at your credit history instead.
We can also ignore adverse credit that’s over 12 months old when it comes to deciding your interest rate.
How does the loan work?
How long does it take to get a bridging loan?
Together have decades of experience in getting bridging cases over the line quickly – and much faster than a typical fixed-term loan or mortgage. This means a Together Bridging loan could get you the cash you need while waiting for longer-term borrowing to be arranged.
How do you decide my interest rate?
The rate you're offered may be influenced by several factors, including:
• What you're using your Together Bridging loan for (whether it’s for personal or commercial purposes).
• How much you need to borrow (both in total, and as a percentage of your property's value).
• Whether you have any other loans secured against the property, that won't be repaid by this loan.
• Your credit history (but not your credit score).
How do you repay a bridging loan?
While you have your loan, one of two things will happen:
• You’ll make interest payments each month, whilst you have your loan (which you can choose to add any fees to). Please be aware, if fees are included in the loan, additional interest will be applied.
• Or, your interest could be added to the lump sum you repay at the end instead. Here at Together, this is the route we give to customers who are buying a property to live in, so you won’t have to make interest payments while you have another mortgage.
How you’ll repay your bridging loan at the end of term will depend on your ‘exit strategy’ – we’ll ask you about this when you’re applying for your bridging loan.
For example, if you were taking out a commercial bridging loan for your business, it may be that you're using the loan to manage cash flow while you wait for a customer to pay a large invoice. Once this invoice has been paid, you’ll use this money to repay your loan and any associated fees.
Or you might be planning to use the proceeds from the sale of a property, or from an inheritance that's currently in probate. Again, once you’ve got the necessary funds in place, you’ll use this to pay off your bridging loan within the 12 month term of your loan.
What should I consider before taking out a bridging loan?
There are some things you should mull over before proceeding:
Is my repayment method realistic?
If you're planning on selling a property to repay the loan for instance, is 12 months long enough to find a buyer and the sale to complete? Would you be able to repay the loan if you were forced into a quick sale at a lower price? Remember that if you're unable to repay your loan within 12 months, your property may be at risk of repossession. In conjunction to this, it’s important to consider that additional fees and charges may be applied if you cannot repay your loan.
How much does a bridging loan cost?
It's important to remember that the longer you take to repay your loan, the more it will cost you so think about what it would potentially cost if circumstances meant you took the full 12 months to repay it.
You should also compare more than just the interest rate and factor in any fees and charges – like an Arrangement Fee, Exit Fee (a Repayment Admin Fee), or similar.
What are the alternatives to a bridging loan?
Bridging finance can often provide the best borrowing option in terms of speed and flexibility, however depending on your situation, an alternative finance solution may be more appropriate.
• Remortgaging
If you’ve already got a mortgage on an existing property, one alternative could be to Remortgage in order to withdraw some equity. However, if you’ve already got a good deal and you’re happy with your current monthly repayments, this may not be the most cost-effective option – especially if you’ll have Early Repayment Charges to contend with.
• Second charge mortgages
If you've built up equity in an existing property (like a rental one), you can leverage it to borrow without remortgaging out of your current deal – to pay for renovations or upgrades, for example.
This kind of loan is known in the industry as a 'second-charge' mortgage, or a ‘secured loan’. It runs alongside, but independent of, any existing mortgage you have. It has its own rate and terms, so you could borrow over a shorter period than remains on your current mortgage.
If you’re unsure, a specialist broker will be able to help you by talking through your available options.
How do I apply for a bridging loan?
If you’re ready to make an enquiry, our team of friendly experts will be more than happy to talk you through the next steps.
If you’re considering a Personal Bridging loan, you can arrange a telephone appointment, or call us on 0330 127 9715 between 9am and 5.30pm, Monday to Friday.
Enquire now
If you’re looking for a Commercial Bridging loan, you can get in touch with us on 0161 451 3150 or request a call back. We’re here 9am to 5.30pm, Monday to Friday.
Enquire now