Tips on applying for bridging finance with a funder
This is for unregulated bridge funding meaning, you are not taking a charge on your current property you reside within nor the next property either using bridging finance that you will live within as both are deemed as regulated.
Please also bare in mind, many of the folks working behind the scenes of bridging finance companies and advisers/intermediaries come from a regulated background and carry with them all, knowledge and a sense and method of doing business that carries them through to the unregulated market. They are clear cut and defined and all work with common sense and a practical mind set. So, when you contact your local or national bridging finance funder or financial adviser, please bare this in mind and, you can also ask them what their own background is in the financial arena. Don’t be worried, you offend us as a person who asks questions makes us all remember what we know and that is true in all fields as it kick starts our minds once more.
You know you want bridging finance as you are buying an investment property to let out as a BTL or HMO via an agent or an auction.
You know you want bridging finance as you are buying a freehold on a street which has a shop below and two apartments above.
You know you want bridging finance as you are buying some land with or without planning and the list goes on.
Questions you need to ask after you have introduced yourself, said the niceties are as follows – how much could I borrow to purchase XYZ.
What would be the cost and interest rate charged.
How long can I borrow the monies for.
My credit is not brilliant, can I still borrow money
All good funders and intermediaries will be taking notes as you both speak and building your case as you continue. When a potential client calls me, I am very easy going and obtain the information I require in 10 minutes or less for a simple bridging finance case.
I ask, are you purchasing in your own name or a company?
You mentioned your credit may not be too sexy so, have you got an up-to-date credit report. I would ask why they feel their credit is not so great in their minds eye. This let’s me know what I am dealing with and what may be in the background.
I would ask who the agent is or if an auction purchase to be, I ask when is the auction to gauge the time we have to work towards the goal of funding.
If it is an auction purchase, I do explain that, the bidding may be more than the properties current value so, what overall funds do you have available.
Have they got a lawyer or would they like me to put one forward for them to contact.
As well as requesting the full address of the property which enables me to do a google search there and then of the potential property and ask any further details I need as I view the asset on-line which is exactly what a funder will do as they are speaking with you and confirming if it is freehold or leasehold.
The conversation is basic as you are not completing a full application but capturing data to enable the funder a clear picture of what is in front of them to lend upon.
I ask for a copy of the report and as ,I am speaking, I take down the potential client email and send a TEST email to them and trust they will receive as we speak. I work out a term in months that I feel they should borrow the funds over, I ask about the exit especially as they have said that their credit is not so good and so I would be concerned if the exit was refinance.
Just by what I can capture in a minimal space of time, I can then present the new enquiry to 3 possible funders and would expect terms of funding back within a 4 hours period.
All in all, I suggest to any potential customer to be straight forward about their request and background, relaxing when speaking with the funder or adviser as we are all human beings and are trying to find some common ground to borrow funds and to lend funds.
I wish you all well and should we be able to be of service then, we welcome you on board.
Mark Thomas