Frequently Asked Questions

Answer:

Bridging finance charges vary from lender to lender. Total costs are determined by loan to value required, type of property and length of loan.

For this reason we cannot give a firm cost here only an indication of what to expect. Interest and fees an applicant could expect to pay incude the following:-

Initial Fees

An upfront fee for the cost of the valuation will need to be paid direct to the lender. The actual cost will depend on the property type and value.

If the subsequent valution is acceptable upfront legal fees will need to be paid.

Arrangement Fee and Interest Charges

Where a bridging finance offer is accepted by a client there will usually be a lender arrangement fee charge that could be added to or deducted from the loan.

Interest is then charged for the term of the loan at a rate of 1% to 2% per month. This could be deducted from the inital loan, added to the loan or paid monthly depending on circumstances. Where redeemed early, any loan interest is refunded on a pro-rata basis where appropriate.

Exit Fees

Some bridging lenders always charge an exit fee of say one months interest.

Other lenders set an minimum term for instance 3 months. Therefore if a bridging loan is re-paid early a minimum of 3 months interest will be charged.