A bridging loan can be defined as short-term finance that is provided by the commercial lenders who want to borrow for a given particular purpose such as an immediate and critical purchase of a property. These types of loans are also called interim financing. A lot of borrowers use these loans to bridge the cash gap when closing real estate transactions. This is because in most cases, there can be a time lag between the sale of property and purchase of another. The good thing about a bridge loan is that it offers you a lot of flexibility.
Where to Borrow
Usually, a borrower is a corporation or an individual and the loan can be customized for a wide range of situations. The reason for borrowing the loan could be the purchase of commercial property, residential property, or land. You can also use the loan during an auction where you bid on any given property with confidence.
The borrower is required to secure the loan with considerable collateral. Business equipment, heavy machinery, inventory, or other real estate properties can be the much-needed collateral. Even the property involved in the buying process can be used as collateral.
Bridging loans are classified into the closed and open loan. Open loans are available to borrowers who are planning to buy a new property before finalizing the sale of their current houses. On the other hand, closed bridging loans are available to borrowers experiencing a delay in moving to the new home because of money.
In most cases, you can be allowed to borrow up to a maximum of 65% of the property. Some lenders provide even up to 100%. Usually, the repayment period for these types of loans ranges from one month to 12 months. The period of repayment is dependent on the amount period and the terms of the lender.
Nowadays, you can get a bridging loan from an online lender or a traditional bank. You need a strong relationship with the lender when applying for this loan. Bridging Loan Fast is one of the UK’s leading online lenders. The good thing about online lenders is that the application process is super-fast and convenient. For instance, you can apply it from the computer as long as you have internet connectivity.
You can browse a wide range of websites that provide loans. The lenders will check the details you have provided and advise you on the best possible loan deal. It is a good idea to collect loan quotes from a wide range of lenders and then carry out a comparison.
Payday loans are loans that people apply for if they need a quick cash injection before their next paychecks. The primary purpose of payday loans is to cater for small emergencies that might find you on an unprepared financial footing. Typically, payday loans come with slightly high interests because of their sole purpose. Payday lenders are the ones who cater for the disbursement of such loans. These are companies that usually offer other suitable financial services like currency exchanges, license processing, utility bill processing among other services. Despite their high interests, these loans are normally short-term and should be repaid within a short period.
How does one apply for payday loans, what is the process?
Visit a Suitable Payday Lender
Payday lenders usually have their branches in all or most of the common cities in a country. You can enquire to get to know the best lenders that offer such loans at slightly lower interests. If your region lucks a payday lender near you, you can opt for online payday lenders that have included all their services online, so that you don’t miss a step when repaying the loan to risk you in incurring extra charges. Some lenders carry out the business strictly online. These are the best ones to opt for.
There are other different types of loans, but payday loans are a bit unique. An important point to know about these loans is that they include no bank applications. Their application only includes your legal name, contact information, banking and employment information alone. You can also be asked to present some additional contacts of your friends and family to help in easy tracking in case you default from paying back the loan.
Write Check for the Required Amount
After presenting your contact information, the lender will offer you a check to write the amount you need and the convenient time for repayment. The amount is usually not tremendous because of the loan purpose and application process. After indicating the amount required, the lender will calculate the rates applied according to the period the loan is to be repaid. He/she will also notify you of the extra charges to be applied in case you fail to repay the loan within the required time.
Cash Deposit and Roll-Over
After all the details are filled correctly, the lender then deposits the amount to your account or gives you a check for the amount. If the check fails to be cashed because of possible financial constraints, you will have the opportunity to roll-over the amount to another term although you’ll incur an extra charge.