BESPOKE BRIDGING LOAN

& SHORT TERM LENDER

RE-BRIDGING EXISTING

BRIDGING LOANS

KNOWLEDGE BASE

There   can   be   a   large   variety   of   reasons   why   borrowers   with   an   existing   bridging   loan   find   themselves   unable   to   exit   the   loan   at   the   end   of   its   term. Unexpected   delays   can   hold   up   a   renovation   project,   perhaps   due   to   unforeseen   complications   with   building   works   or   planning   permission   issues. Alternatively,   market   conditions   might   change   affecting   the   availability   of   mortgages   or   the   prospects   of   a   sale   and   sometimes   it   can   be   as   simple   as the original loan period sought was just too short. In   the   past   many   bridging   lenders   were   at   best   reluctant   and   at   worst   completely   unwilling   to   offer   bridging   loans   to   refinance   a   previous   bridging loan   but   there   are   now   some   lenders   that   will   consider   re-bridges.   To   do   so   they   will   need   to   understand   exactly   why   the   previous   bridge   has   not redeemed as planned and be convinced that any subsequent loan they advance will be successfully redeemed. Bridging   loans   are   often   sold   as   a   dual   rate   product   with   a   discounted   rate   for   a   defined   loan   term,   be   that   3,12   or   even   24   months   and   a   standard rate   is   then   applied   if   this   loan   goes   over   the   agreed   term.   The   standard   rate   can   often   be   substantially   higher   than   the   discounted   meaning   that   a loan, particularly if its large, that goes past its planned redemption date can quickly accrue significant sums of additional interest. Certain   industry   commentators   seem   to   feel   that   re-bridging   is   a   bad   thing   for   the   industry   and   irresponsible,   suggesting   that   its   indicative   of   an increasingly   competitive   market   where   lenders   are   being   forced   to   take   ever   greater   risks   to   obtain   market   share.   Of   course,   the   absolute   key   for   any bridging   loan   is   a   clear   exit   route   and   if   a   loan   needs   to   be   re-bridged   then,   by   definition,   something   has   gone   wrong   with   the   originally   planned   exit. However, as detailed in the reasons above, potential problems and delays cannot always be anticipated. If   unforeseen   problems   arise   with   a   development   but   the   work   is   well   underway,   the   residual   value   of   the   property   has   increased,   the   developer   is competent   with   a   good   track   record   and   it   is   clear   that   it   can   be   finished   within   a   set   period,   then   it   can   make   perfect   sense   for   a   new   lender   to provide another bridging loan. In   circumstances   such   as   these   responsible   lenders   are   prepared   to   take   the   time   and   have   the   in-house   expertise   to   fully   assess   a   potential   re- bridge. Once they fully understand what’s happened to reach this point they can make an informed decision on whether they are prepared to assist. Of   course,   not   all   re-bridges   are   assessed   so   fully   and   in   a   worst-case   scenario   there   can   be   instances   where   a   property   has   been   re-bridged   several times   with   fees   spiralling,   equity   being   eaten   away   and   still   no   clearly   defined   exit   plan   in   place.   Such   cases   merely   serve   to   underline   the   absolute importance of working directly and closely with an experienced principal lender who can ensure that any re-bridge undertaken is a success. Still unsure and need to explore your options? Why not consult an expert? Central   Bridging   are   bridging   loan   specialists   with   a   great   track   record.   We   are   a   principal   lender   offering   a   range   of   loan   facilities   for   business   use from £250K to £2.5M over periods from 3 to 24 months. Our loans are secured on freehold property across England and Wales. Crucially   you   will   always   speak   to   a   decision   maker   who   will   take   time   to   understand   you   and   your   situation   and   unlike   some   of   the   bigger   banks   will then tailor a solution that best suits your needs rather than their own. For a confidential discussion in the first instance contact us on:   Tel 03332 400 506   Email enquiry@centralbridging.co.uk Online
Central Bridging, Granary Wharf, Wharf Road, Burton on Trent, Staffordshire, DE14 1DU Tel: 03332 400 506   Email: enquiry@centralbridging.co.uk   Web: www.centralbridging.co.uk Central Bridging is a trading style of Central Bridging Loans Ltd. Registered in England & Wales | Company Registration Number 07728274. Central Bridging is not regulated by the Financial Conduct Authority (FCA). All loans arranged by Central Bridging are non regulated contracts as defined under The Financial Services and Markets (Regulated Activities) Order 2001 and the Financial Service and Markets Mortgage Credit Directive Order 2015. © Copyright Central Bridging Loans Limited Privacy Policy
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BESPOKE BRIDGING LOAN

& SHORT TERM LENDER

There    can    be    a    large    variety    of    reasons    why    borrowers    with    an existing   bridging   loan   find   themselves   unable   to   exit   the   loan   at   the end   of   its   term.   Unexpected   delays   can   hold   up   a   renovation   project, perhaps    due    to    unforeseen    complications    with    building    works    or planning    permission    issues.    Alternatively,    market    conditions    might change   affecting   the   availability   of   mortgages   or   the   prospects   of   a sale   and   sometimes   it   can   be   as   simple   as   the   original   loan   period sought was just too short. In   the   past   many   bridging   lenders   were   at   best   reluctant   and   at   worst completely   unwilling   to   offer   bridging   loans   to   refinance   a   previous bridging   loan   but   there   are   now   some   lenders   that   will   consider   re- bridges.    To    do    so    they    will    need    to    understand    exactly    why    the previous   bridge   has   not   redeemed   as   planned   and   be   convinced   that any subsequent loan they advance will be successfully redeemed. Bridging   loans   are   often   sold   as   a   dual   rate   product   with   a   discounted rate   for   a   defined   loan   term,   be   that   3,12   or   even   24   months   and   a standard   rate   is   then   applied   if   this   loan   goes   over   the   agreed   term. The     standard     rate     can     often     be     substantially     higher     than     the discounted   meaning   that   a   loan,   particularly   if   its   large,   that   goes   past its   planned   redemption   date   can   quickly   accrue   significant   sums   of additional interest. Certain   industry   commentators   seem   to   feel   that   re-bridging   is   a   bad thing   for   the   industry   and   irresponsible,   suggesting   that   its   indicative of   an   increasingly   competitive   market   where   lenders   are   being   forced to    take    ever    greater    risks    to    obtain    market    share.    Of    course,    the absolute   key   for   any   bridging   loan   is   a   clear   exit   route   and   if   a   loan needs   to   be   re-bridged   then,   by   definition,   something   has   gone   wrong with   the   originally   planned   exit.   However,   as   detailed   in   the   reasons above, potential problems and delays cannot always be anticipated. If   unforeseen   problems   arise   with   a   development   but   the   work   is   well underway,    the    residual    value    of    the    property    has    increased,    the developer   is   competent   with   a   good   track   record   and   it   is   clear   that   it can   be   finished   within   a   set   period,   then   it   can   make   perfect   sense   for a new lender to provide another bridging loan. In   circumstances   such   as   these   responsible   lenders   are   prepared   to take    the    time    and    have    the    in-house    expertise    to    fully    assess    a potential   re-bridge.   Once   they   fully   understand   what’s   happened   to reach   this   point   they   can   make   an   informed   decision   on   whether   they are prepared to assist. Of   course,   not   all   re-bridges   are   assessed   so   fully   and   in   a   worst-case scenario   there   can   be   instances   where   a   property   has   been   re-bridged several   times   with   fees   spiralling,   equity   being   eaten   away   and   still   no clearly    defined    exit    plan    in    place.    Such    cases    merely    serve    to underline    the    absolute    importance    of    working    directly    and    closely with    an    experienced    principal    lender    who    can    ensure    that    any    re- bridge undertaken is a success. Still   unsure   and   need   to   explore   your   options?   Why   not   consult   an expert? Central   Bridging   are   bridging   loan   specialists   with   a   great   track   record. We    are    a    principal    lender    offering    a    range    of    loan    facilities    for business   use   from   £250K   to   £2.5M   over   periods   from   3   to   24   months. Our    loans    are    secured    on    freehold    property    across    England    and Wales. Crucially   you   will   always   speak   to   a   decision   maker   who   will   take   time to   understand   you   and   your   situation   and   unlike   some   of   the   bigger banks   will   then   tailor   a   solution   that   best   suits   your   needs   rather   than their own. For a confidential discussion in the first instance contact us on:   Tel 03332 400 506   Email enquiry@centralbridging.co.uk Online
Central Bridging, Granary Wharf, Wharf Road, Burton on Trent, Staffordshire, DE14 1DU Tel: 03332 400 506  Email: enquiry@centralbridging.co.uk Web: www.centralbridging.co.uk Central Bridging is a trading style of Central Bridging Loans Ltd. Registered in England & Wales | Company Registration Number 07728274. Central Bridging is not regulated by the Financial Conduct Authority (FCA). All loans arranged by Central Bridging are non regulated contracts as defined under The Financial Services and Markets (Regulated Activities) Order 2001 and the Financial Service and Markets Mortgage Credit Directive Order 2015. © Copyright Central Bridging Loans Limited Privacy Policy
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RE-BRIDGING EXISTING

BRIDGING LOANS

KNOWLEDGE BASE

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