Bridging Loan

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Gordon-46351Bridging loans meet the needs of many individuals and businesses today. They are rapidly loaned to qualified applicants and then usually repaid within one to three months, though many are offered for terms that require payment in up to a year. The financial needs are of a short-term nature and a bridging loan connects the loan recipient to the other side of the temporary need. The imagery is of a bridge over troubled water.Short-term bridging loans often come into play when a business has a cash flow problem or sees the need to make an investment but lacks the resources to do so. There may be a contract that will be honoured in due time and payment made to the business but the money is needed now. If the business can ensure repayment, a bank or other financial lending institution may choose to issue a bridging loan for the business’ capital investment, venture capital, stock acquisition, production, or a host of other needs. The temporary bridging loan is just that: a means of moving over temporary financial needs to help the business reach the other side.Bridging loans are also popular in the housing market. Homeowners who are selling a property can utilize a short-term bridging loan to pay for a new home while the old one is still on the market. Living expenses can be covered while a sale is pending. A bridging loan can also be used for unexpected repairs that a buyer of the old home is requiring. Once the old home is sold the loan will be paid in full.Urgent needs for money sometimes occur. Financial setbacks can happen to people for a variety of reasons and a short-term bridging loan can help smooth out the financial needs until the individual is back on his or her feet. Divorce, sickness, injury, the loss of a job or a stock market crash can all necessitate a bridging loan.Bridging loans can be extremely helpful in the short-term but they come with a higher interest rates. The loan will carry high interest rates and sufficient collateral such as cars, home, business property, or other valuable asset will have to be offered as a security for the loan. If the loan isn’t repaid in the specified amount of time the security is subject to repossession. Bridging loans are effective but only if repayment can be made.In summary, to obtain a bridging loan you must have a security. Normally the security is real estate, your home. block of land or a commercial building. In some instances other assets can be offered as a security such as cars and shares. Bridging loan is taken for the period between 1 to 12 months. Bridging loans are usually organised within 24 to 72 hours.Bridging Loan

provides finance for any business purpose including property investment, within 1 to 3 business days.

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