Business Loans

How Bridging Loans Can Help You Achieve Your Goals

There are many types of personal and business loans available to companies and consumers. Bridging loans are a form of property loan that provides temporary financing designed to last for a short period of time. Most bridging loans last for a few months, while some may have terms that go up to one full year. These loans offer flexible forms of financing to property investors, landlords, and even to individuals who are looking to buy a new home. The term bridging loan comes from the way that it provides you with a “bridge” between two different financial transactions. For example, if you’re interested in buying a home but need to sell first, bridging loans can help you fill in the gaps until you sell your first home.

For business loans, a closed bridging loan is usually the most common option. These types of loans have an actual set date for when the loan is expected to be paid off. However, you may choose to pay off the loan early if you wish. Most businesses choose closed bridging loans because they already have a set timeline for when the loan will no longer be needed. In many cases, this type of loan has lower interest rates than an open bridging loan.

 

An open bridging loan still has a maximum term that typically lasts between six and 12 months. However, you’re able to pay the loan back in full at any time, or even in incremental amounts during the term period. If you don’t have a clear timeline for when the loan will no longer be needed, then an open bridging loan can be a good choice. If you need help with your finances, a settlement advance is a wonderful alternative to bridging loans. Contact us today to find out more about how we can help.