Commercial Bridging Finance

If you need to raise capital quickly for a time-sensitive project, a commercial bridging loan will help keep your business moving.



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If you need funds quickly to finance a large business transaction, a short-term commercial bridging loan could offer you the ideal financial solution. Commercial bridging finance is often used as a form of short-term property development finance to help bridge the gap when other funds are tied up or not available. Typically used to finance sizeable commercial investments, such as property developments or office relocations, bridging finance is used as a short-term temporary loan that can be cleared at the end of the term or refinanced using a more permanent financial arrangement, such as a mortgage.

What Is Commercial Bridging Finance?

If your business is struggling to secure a traditional form of finance with a high street lender, a commercial bridging loan could offer the quick injection of cash you need to keep your project on the go. Commercial bridging finance can be used to fund sizeable commercial investments on a short-term basis. A type of alternative finance, it can be used for a variety of commercial purposes, as long as you can provide a clear exit strategy that summarises how the short-term loan will be repaid at the end of the agreement.

Many property developers in the construction industry use commercial bridging loans as a way to keep projects moving. Often, business capital is already tied up in the project and can only be released on the sale of a property or development. This form of short-term alternative finance can be used to bridge the gap when other funds are unavailable. It allows developers to continue funding their project; the finance can be paid back on the sale of the property. Alternatively, in the case of office relocations for example, the loan can finance the move whilst a more permanent source of funding, such as a mortgage, is being secured.

If you have a valid exit strategy and you need to raise capital quickly, bridging finance loans can be used to fund other time-sensitive commercial projects. The purpose must be specifically stated but scenarios often include investing in a new business, establishing a commercial partnership, or buying land or property at auction. In some cases, commercial bridging loans can even be used as a way to cover unexpected tax liabilities. Although the reason for wanting the funds is important, what interests lenders the most is your exit plan.

To qualify for a commercial bridging loan, you must have a clearly defined exit strategy that states how the funds will be repaid at the end of the agreed term. You may be able to release tied-up capital in the sale of a property, which will allow you to clear the loan in its entirety; this is usually agreed at the outset of the arrangement. Alternatively, you can seek a longer-term funding source, which can be used to repay the funds; this is known as a refinancing arrangement. It is very common for commercial bridging loans to be used as an alternative form of short-term finance while a more permanent financial arrangement is being agreed.

As commercial bridging loans offer a highly convenient, short-term financial fix for business owners, interest rates tend to be higher than other forms of alternative finance and arrangement fees can be imposed. However, the over-riding benefit for businesses is the fact that funds can be transferred incredibly quickly once approved, ensuring your project continues to run to schedule without having to incur frustrating delays or derailing entirely.

The Benefits for Business Lenders.

When you need funds quickly, a commercial bridging loan could offer the short-term financial solution you need. Some business opportunities need to be seized quickly and this is when bridging finance can help. Our alternative finance providers support many business owners to secure funds from £26,000 to £5million for a range of commercial purposes.

These short-term business loans are typically repaid within one to twenty-four months. Unlike most other forms of alternative finance, commercial bridging loans can be arranged exceptionally quickly; in most cases within 24 to 48 hours.

Does My Business Qualify?

When it comes to commercial bridging loans, individuals, partnerships and limited companies are all considered by our alternative funding providers. As stated, a clearly defined exit plan is fundamental to securing this type of finance. This is a short-term financial agreement that must be repaid either by the lender receiving the payment in full at the end of the arrangement or the funds being refinanced using a permanent funding source, such as a mortgage. A personal asset may be required as security against the loan. You must have a good credit history with no CCJs, mortgage arrears or defaults.

Your commercial bridging loan could be arranged within 24 to 48 hours. To find out of you qualify for commercial bridging finance, please apply now for your free, no obligation quotation.

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