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Bridging Loan Self Build?
17 Answers
hi..we have plans with 4 weeks to go in, we are building a new house and need about 110grand...we are both self employed and today the mortgage company said they now want 3 months of my wages post covid..i only started again on monday...we dont want to wait another 4 or 5 months..are the bridging loans as bad as they say?? Once built we can remortgage as the house built will be worth 300g..
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Bridging loan rates currently vary from around 0.5% per month up to 2% per month. So, based upon a loan of £110k, that could cost you between £550 and £2,200 per month:
https:/ /www.mo ney.co. uk/brid ging-lo ans.htm
Bridging loan rates currently vary from around 0.5% per month up to 2% per month. So, based upon a loan of £110k, that could cost you between £550 and £2,200 per month:
https:/
Bednobs has already asked my first question. In my experience of doing this, I can tell you that, in the early stages of the build, you shouldn't need anything like the whole 110k to get it out of the ground and on its way.
There's no point in taking out a bridging loan and have it sit in the bank doing nothing for you. As Bueno says, it can be quite expensive.
My first call has always been my Bank. There are various arrangements available for self-build finance. I do it as a business, but it doesn't have to be so for you.
Arrange an overdraft facility. Initially, you take out small amounts. Then, you only pay interest on that amount, not the whole lot.
Cash advances will be staged. As the build progresses, there is more and more value in the property, thus allowing the Bank to release more money, but with increased security for them against the borrowings.
Research the Self-build market. There's a lot of advice available.
Good luck.
There's no point in taking out a bridging loan and have it sit in the bank doing nothing for you. As Bueno says, it can be quite expensive.
My first call has always been my Bank. There are various arrangements available for self-build finance. I do it as a business, but it doesn't have to be so for you.
Arrange an overdraft facility. Initially, you take out small amounts. Then, you only pay interest on that amount, not the whole lot.
Cash advances will be staged. As the build progresses, there is more and more value in the property, thus allowing the Bank to release more money, but with increased security for them against the borrowings.
Research the Self-build market. There's a lot of advice available.
Good luck.
The rates in Buenchico's link will be for an ordinary property bridgeover. You will probably need a specialist self build lender, the rates are traditionally a lot higher, and don't be surprised when they charge an arrangement fee. If you are not a professional builder you will already be on the back foot., and lenders do not like open ended loans, they will expect a repayment date.
Although the link below says without planning permission, it gives some useful info.
https:/ /www.on linemor tgagead visor.c o.uk/br idging- finance /land-b ridging -loans/ #withou t-plann ing-per mission
Although I was in mainstream banking I only had one customer go ahead after having all the costs given to them.
Although the link below says without planning permission, it gives some useful info.
https:/
Although I was in mainstream banking I only had one customer go ahead after having all the costs given to them.
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