Blog

Bridging loans are short-term loans designed for those properties or borrowers that wouldn’t be able to obtain longer-term finance. They can provide a powerful option for property investors who want to take advantage of opportunities that they would otherwise miss due to tight deadlines.This guide explores the basics of bridging loans, giving you the key information about this specialised form of property finance. It will also discuss opportunities that bridging loans can enable you to take advantage of, helping you make informed decisions about this specialised form of finance. What are bridging loans? Bridging loans are short-term financing solutions secured against property, designed to provide capital to borrowers who require quick access to funds. They are highly suitable when time is of the essence, such as capitalising on opportunities with tight deadlines or purchasing property via auction. Essentially, bridging loans give borrowers an option of financing that meets the need for immediate capital when longer-term loans may not be available in time.Alongside speed, a bridging loan’s other main defining characteristic is flexibility. While they are often used for property acquisitions, bridging loans can also be used to raise capital, exit a development loan, fund property refurbishments, and more.However, the benefits of bridging loans tend to come with higher interest rates than mainstream loans. This higher interest is due to their short-term nature, the speed at which loans progress and the increased risk lenders take on by offering bridging loans. They are not intended to be a long-term financing solution but rather a tactical tool, either for those who need immediate capital to take advantage of opportunities or who cannot obtain long-term finance due to their circumstances or a property’s condition. How do bridging loans work? Bridging loans are relatively straightforward, although they require careful consideration of various factors. When a borrower applies for a bridging loan, KSEYE will evaluate the security property(s) (which can include the asset being acquired), the borrower’s financial situation, and the proposed way of repaying the loan, such as a refinancing onto a longer-term loan or the sale of an asset.Following this initial evaluation, KSEYE will issue a set of terms, offering an indicative interest rate and the % of the property value we will lend (known as Loan to Value, or LTV). If a borrower proceeds to a full application, we will instruct a valuation on the property, and if this comes back as expected, there are only the legal steps to go until the loan is complete and we provide the desired funds.The repayment structure of bridging loans is usually set for a short duration, typically ranging between 3 and 12 months. Borrowers have to repay the full amount of the loan, including interest, by the end of the term. Having a solid plan to repay the loan is vital and forms a key part of a bridging loan application. Advantages of bridging loans Bridging loans offer several advantages that make them an attractive financing option. One of the most significant benefits is the speed of funding. Mainstream lenders may take months to approve a loan. By contrast, bridging loans provide funds much faster, even within days, in exceptional circumstances. This speed allows borrowers to act quickly on investment opportunities with strict deadlines, which they would otherwise miss out on.Another advantage is the flexibility of bridging loans. Versatility can be a game-changer for those navigating complex financial situations, such as having adverse credit issues which would prevent them from obtaining mainstream finance. This flexibility can also extend to the property itself. For example, an investor might use a bridging loan to purchase a dilapidated property in a desirable location and renovate it before either selling it for a profit or refinancing it with a buy-to-let mortgage.Bridging loans can also be structured to fit a borrower’s specific needs. With varying repayment terms and interest options, borrowers can choose a repayment option that aligns with their financial strategy. This can enhance the overall financial management of a property investment or other projects, giving borrowers greater control. By understanding these advantages, potential borrowers can better assess how bridging loans might fit into their broader financial plans.To learn more about bridging loans, discuss them with your property broker or contact KSEYE today.

KSEYE’s residential bridging loans can help your clients unlock the potential of property investments. To meet a diverse range of client needs, we have two major residential bridging loan products – our fully-featured Bespoke bridging and our Resi-Lite bridging, which is designed for straightforward loans with little to no complexity involved. The benefits of bridging finance for residential properties Between our Bespoke and Resi-Lite residential bridging product options, KSEYE offers versatile and efficient solutions to the clients of property brokers who are looking to capitalise on time-sensitive opportunities.Whether they are looking to capitalise on a property investment available at auction, exit a development loan, or acquire and refurbish a property to sell at a profit, our residential bridging loans can provide the necessary funds quickly.By taking advantage of a residential bridging loan, clients can move swiftly on lucrative deals, acquire properties that would not be eligible for mainstream finance, and even resolve short-term cash flow issues. This type of financing can be crucial in competitive markets, allowing clients to take advantage of property investments they may otherwise miss out on. How KSEYE's residential bridging products can help your clients KSEYE’s residential bridging product range is designed with flexibility and speed in mind.Our Bespoke residential bridging offers a tailored approach to every client’s unique circumstances, ensuring that the loan structure fits perfectly with the investment strategy.Our Resi-Lite bridging has slightly more rigid criteria and provides a lower-rate option for those loans that are less complex. It is available for properties in London, the Home Counties and major UK cities, and can accommodate properties that need non-structural refurbishment.Between these two products, we offer competitive rates and terms that cater to a wide range of residential property needs, from straightforward purchases to complex renovation projects.Additionally, KSEYE prides itself on a swift and straightforward application process, often providing decisions within hours and funds within days. Our commitment to transparency and customer service means that property brokers and their clients are kept up to date at every step of the process, from enquiry to completion. Applying for a residential bridging loan from KSEYE Applying for KSEYE’s residential bridging products is a streamlined and efficient process. First, property brokers should gather essential details about the client’s property and financial situation. Following this, you can submit an enquiry either through KSEYE’s website or by getting in contact with your BDM.Once the enquiry is submitted, our underwriting team will review the information and provide indicative terms within hours. If the client wants to proceed, they will complete a full application form, pay a commitment fee, and we will instruct a valuation on their security property.After the legal stages are complete and any outstanding underwriting points are resolved, the loan is ready to be finalised, and funds will be released to your client – typically within 24 hours.This user-friendly process ensures your clients can access the necessary financing quickly and with minimal hassle. Work with KSEYE If you have clients who bring cases you know need a residential bridging loan, we would love to work with you to meet their funding needs. To start working with KSEYE, contact your BDM, register as a KSEYE broker or submit an enquiry today.

Property auctions can provide an ideal opportunity for investors to acquire assets below their market value, but the tight timescales involved mean that funding can be an issue.Where the funding for an auction purchase is required within 28 days, bridging loans offer the ideal solution to provide funding in time for any deadline.Auction bridging finance at KSEYE can go even further, as we can pre-agree auction finance. This means we can offer indicative terms before the auction takes place, to allow you/your clients to enter an auction knowing that the first steps of obtaining finance are already underway.So how do our pre-agreed auction bridging loans work? The step-by-step guide below tells you everything you need to know. Identify the property Before any property auction, the catalogue will contain information about each lot. Assessing the details of the properties in terms of how worthwhile they are as an investment – either to form part of a property portfolio or to refurbish and sell – is the first step in the process. Send the details to KSEYE After you identify the property you/your client hopes to acquire, share the property details with us. Our underwriting team will look at the property and ask any necessary initial questions. We will give an indicative rate & LTV After our underwriters have finished their initial assessment, they will send a set of indicative terms. This is the rate and LTV which we will lend at unless something materially changes. Bid with confidence With the indicative terms, you/your client can bid with confidence, safe in the knowledge that the process of obtaining finance to meet the auction deadline is underway. Win the auction, and proceed with the loan With indicative terms already being issued, all you/your client need to do is complete a loan application form to proceed with KSEYE. Our team act urgently when we know there is a strict deadline that funds are needed by, and we’ll keep you updated every step of the way. To learn more about KSEYE’s auction finance, visit our dedicated product page, or to discuss a pre-agreed auction bridging loan, contact us today.

Purchasing properties at auctions is an enticing way to secure deals for property investors in the UK. In January 2024, property auctions saw a 45% increase in the number of lots offered when compared to January 2023. This means an increase in the number of options available to property investors.However, winning a property auction also comes with a tight payment deadline. Once an auction is completed and the property is won, the successful bidder only has a short timeframe – typically 28 days – to complete the purchase by paying the remaining balance. This is where a bridging loan for financing an auction purchase is incredibly beneficial, and KSEYE specialise in this kind of loan. What is bridging auction finance? Bridging loans are short-term loans designed to help buyers secure funds quickly, making them ideal to meet the payment deadline for auction purchases. Properties at auctions range are diverse, including residential, commercial, and mixed-use assets. They are an increasingly popular way to acquire property, with properties on average selling between 85% to 90% of their market value at auctions, giving savvy investors an opportunity to acquire properties at lower prices. Why choose a KSEYE bridging loan to fund your auction purchase? At KSEYE, we understand the pressures of obtaining finance for auction purchases and have 12 years of experience in helping a diverse range of borrowers, including assisting many investors to fund their property auction purchases.Here’s how:A track-record of meeting funding deadlinesWe specialise in meeting tight deadlines, which is ideal for borrowers looking for a bridging loan to complete their auction purchase. Our streamlined processes start with indicative terms in a matter of hours, and we can deliver funds in a matter of days when it is needed.Pre-agreed auction finance to bid with confidenceAs we know the time-pressure that investors can feel to secure funding after winning a lot at auction, we can start the funding process ahead of the bidding. Our pre-agreed auction finance bridging loans enabling buyers to secure indicative loan terms in advance, ensuring buyers can bid confidently, knowing the process of obtaining finance is underway.An expert in-house legal teamOur in-house legal team is something which many lenders do not have. They enable us to deal with any complexities in a bridging loan quickly, speeding up the loan process as we don’t need to rely on external support. They also work closely with our panel of solicitors to keep the legal process moving along quickly, which is essential for any bridging loan with a deadline. Ready to bid confidently? When it comes to auction finance, speed, expertise and reliability are non-negotiable. KSEYE deliver all three, giving you full confidence to bid and secure your next property investment.To learn more about KSEYE’s approach to auction finance, visit our dedicated product page, or to discuss a pre-agreed auction bridging loan, contact us today.

July was a busy month here at KSEYE. From a wonderful summer party to landmark deals and notable product updates, a lot happened! You can find everything you need to know in the recap below.At the start of the month, we held our Spanish Summer Fiesta at Aqua Nuevo. The night included a specially curated menu, ranging from patatas bravas to chicken bomba rice, with sangria served on arrival and a range of classic cocktails. However, it was the guests who joined us who made the party as fun as it was! You can find a collection of photos from the event below.In mid-July, we completed a notable £14.25m development exit bridging loan at 75% LTV, taking our cumulative lending close to £800m.This loan was followed by the announcement that we have doubled our maximum loan size to £50m, in response to an increased appetite for large loans in the first half of the year, both in enquiries received and loans we have funded.

In June, members of the KSEYE team visited Birmingham NEC for the NACFB Commercial Finance Expo 2024, one of the major…