Whether you are trying to purchase a new property or develop an existing property, one of the most important components of this process is access to reliable financing. Not only do you need to have access to financing, but you need to be able to get it in a short amount of time. If you are looking for an option that meets this criteria, you should consider using bridging finance. While bridging finance can be used by normal people for things such as consolidating their debt, it's an ideal finance option for property developers and other professionals who deal with properties.
In your line of work, there are certain sources that provide access to the best deals. One of these sources is auctions. When a home hits the auction block, it may be the ideal opportunity to make a handsome profit with only a minimal amount of work. While these types of homes can be very good for your business, the work they do require is quickly securing financing. With bridging finance, you can get the financing you need in the short window of time that is available to you. If you attempted to go the route of submitting a traditional mortgage application, you would lose out on the opportunity to a competitor who could secure the necessary funding much sooner than you could from a regular mortgage.
One of the features that makes this type of financing very attractive to developers and other professionals is that it doesn't require them to sell anything to generate the cash flow they need. Instead, you will be able to use the value of the properties you already own to obtain the bridging finance that you need. Another advantage of this type of financing is that the interest rates are surprisingly reasonable. Because you may only be holding the property for a short period of time, the reasonable interest rates are an especially good thing.
If you decide that bridging finance is exactly what you need to take advantage of a deal that is available, you will be surprised by the fact that the process of obtaining this type of financing is actually easier than most people expect. When it comes to setting the amount of your financing by determining the value of your existing properties, different brokers will have different methods for arriving at their final valuation. As a result, don't be afraid to shop around between a few brokers. While you may not be happy with the valuation that one gives you, that doesn't mean that another one won't give you the valuation you want.
In addition to receiving different valuations, you'll also find that you can negotiate with brokers for the specific terms of your bridging finance. For example, if you can show them that you'll be able to bring them additional business in the future, they may be able to cut you a special break or provide other incentives to ensure that they secure you as a customer.
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