411homerepair.com

Mortgage, Bridging Loan or Development Finance

by James Kilvert on May 10, 2019

If you are planning to invest in a property that needs renovating or improving in some way, you may need to secure financial support. For property development projects like these, typical options on the table include bridging loans, mortgages, and specialist property development finance.

The question is - which of the available options is the right option for you?

Conventional Mortgage Products

In terms of cost-effectiveness, traditional mortgages provide the ideal long-term solution.

Mortgage Broker Experts in Property Finance - "Repaid over several years or even decades, mortgages are useful for spreading the costs accordingly." On the downside, a conventional mortgage can be difficult and time-consuming to organize in the first place. Particularly where bad credit mortgage loans are concerned, which can also be significantly less competitive in terms of borrowing costs.  

Furthermore, there’s typically no allowance for traditional mortgage loans when the property isn’t already inhabitable and had a good state of repair. Hence, for investments where the objective is to develop a rundown or outdated property, conventional mortgage products may be out of the question.

Mortgage, Bridging Loan or Development Finance

Bridging Loans

Where a property isn’t currently considered habitable, a bridging loan could be the ideal funding solution for the renovations and development required. With bridging loans, funds can be raised for any purpose whatsoever, secured on a wide variety of property types. So even if the property in question isn’t currently habitable, bridging loans.

Where a property isn’t currently considered habitable, a bridging loan could be the ideal funding solution for the renovations and development required. With bridging loans, funds can be raised for any purpose whatsoever, secured on a wide variety of property types. So even if the property in question isn’t currently habitable, bridging finance may be accessible.

Bridging loans are designed to be repaid within a matter of months, in the form of one lump sum payment on an agreed date. The short-term nature of bridging finance can make it a uniquely affordable solution for investors and property developers. Perhaps most importantly of all, a bridging loan application can be completed and the funds made available within a matter of days. Eligibility is typically established exclusively on the basis of security/collateral provided, which can mean no credit checks and no proof of income required.

Development Finance

Similar to a bridging loan, development finance provides rapid access to the funds required, to be repaid in full within a matter of months. Nevertheless, development finance products are typically more suitable for ground-up developments and more extensive construction/renovation projects.

Qualifying for development finance can be a little trickier, as the lender needs to collect information on the current nature and value of the asset, the details of the project plan, how long it will take to complete the project, estimated costs for its completion, eventual revenues and so on. Rather than simply securing the loan on the borrower’s existing property - as with a bridging loan - there may be more to take into account. Nevertheless, development finance can be uniquely accessible and affordable - particularly where larger and more challenging projects are concerned.

The Importance of Independent Advice

In accordance with your objectives and requirements, you may find yourself in a position where all three options are readily available. Nevertheless, one of the three will undoubtedly suit your goals and your budget better than the other two.

This is precisely why independent advice and consultancy should be sought from the earliest possible stage. Rather than approaching any specific lender directly, take your case to an independent financial adviser or broker. Discuss the available options with an impartial third party and have them carry out a whole-of-market comparison on your behalf.

Only then can you be sure the financial product you select is the most affordable and appropriate for your needs.

Latest Articles

How Much Does It Cost To Take A Bath​?

Plumbers know that a bath may seem like a relaxing luxury, but the real cost extends far beyond your water bill. The average soak uses 35 to 50...

on Apr 8, 2025

10 Concrete Patio Ideas on a Budget

A concrete patio can be a game-changer for your outdoor space. It is durable, versatile, and can be customized to fit your style. But what if you...

on Mar 25, 2025

Tips for Creating a Stunning Personalized Photo on Canvas

Order the unique beauty of a personalized photo on canvas and bring your memories to life. With a customized photo on canvas, you can transform...

on Mar 7, 2025

Best Areas to Buy Property in Singapore for Long-Term Growth

Singapore's real estate market remains one of the most stable and lucrative in the world. With limited land supply, strong governmental...

on Feb 18, 2025

Troubleshooting Excess Water in Your HVAC Secondary Condensate Drain Pan

When maintaining your air conditioning system, it is easy to overlook the condensate drain pan - until excess water starts pooling in places where...

on Jan 12, 2025

Sponsored Articles

Actions

More DIY Articles

Tips for You to Remodel Kitchen Cabinets Easily

Of all the home renovations that can be done, kitchen remodeling is perhaps the most difficult. This is because it can be the most expensive among...

Kitchen / Bathrooms

Power Tool Safety Starts with Common Sense

Power tool safety means taking necessary precautions to avoid harming anyone when working with power tools. Every home project means subjecting...

Tools / Woodworking

When Should I Replace My Air Conditioner?

Like everything else, an air conditioner does not last forever. The average air conditioning system lasts as long as 15 years, depending on how...

HVAC / Air Conditioning

What Dust Is Made of and How it Affects Your Health

Many of these particles are carried in the air we breathe. The larger particles settle out on walls and furniture in our living environment. The...

Cleaning / Maintenance

A Breakdown of the Various Dewalt Circular Saws and Which one to Choose

Dewalt is one of the most notable circular saw makers on the market. This is because their products are not only of high quality but also deliver...

Tools / Woodworking

Contact Us | Submit Article | 411homerepair © 2025