A bridging loan is finance secured against a property. This is provided by a lender as a short term solution for debt until a more appropriate longer term loan package can be sourced.
This type of finance is often taken out for a period of time between two weeks and three years. As a bridging loan is a form of interim financing it is typically more expensive than normal financing with higher fees from the lender. The benefit of bridging loans is that they can be arranged quickly with rather less hassle than other means of finance.
This form of lending can be invaluable in facilitating property purchased which may otherwise fall through due to a gap in lending and as the name suggests can help ‘bridge’ that gap at a premium.