Increasingly, UK property investors and developers are setting their sights on overseas opportunities. The UK’s lending market is one of the most competitive in the world, opening the door to affordable and profitable investment opportunities across Europe and the US.
As is the case with domestic projects and property investments, overseas business opportunities are often time-critical in nature. This is where international bridging finance can help, providing rapid access to significant sums of money when time is a factor.
International bridging finance provides fast bridging loans which are then repaid within a matter of months, with competitive rates of interest and minimal overall borrowing costs.
How Does International Bridging Finance Work?
International bridging finance works in a similar way to domestic bridging finance. The only difference being that the unique rules and regulations of the target country must be taken into account, though in all instances, it is almost always more cost-effective to seek international bridging finance in the UK, rather than working with an overseas lender.
It is worth bearing in mind when looking to secure bridging finance against an overseas property or for an international project is the likelihood of a more time-consuming application process. Organising inspections, surveys, valuations and so on where overseas properties are concerned can naturally be more labour intensive.
It may also be necessary to appoint representatives or legal counsel in the target destination, which can again add to the complexity of the transaction.
Working with an independent broker is therefore essential, in order to streamline and simplify the process of securing a competitive international bridging loan.
What Types of International Bridging Loans Are Available?
As with domestic bridging loans, there are two types of international bridging loans available:
Open Bridging Loans – Those issued without a formal exit strategy having been agreed, with no specific repayment date on which the full balance of the loan is to be repaid.
Closed Bridging Loans – Where details of a viable exit strategy have been provided and a date has been agreed for full repayment of the loan.
As closed bridging finance is considered lower risk, it is usually offered at more competitive rates of interest and with lower overall borrowing costs. Nevertheless, it is essential to compare the market in its entirety, as international bridging loans in particular differ significantly from one lender to the next.
What Can International Bridging Loans Be Used For?
International bridging finance can be used for almost any legal purpose whatsoever. There’s near-limitless scope in terms of potential applications for international bridging finance, though some of the more typical uses for bridging loans include the following:
Funding international property development projects
Renovating and improving residential or commercial properties
Financing new businesses and startups
An accessible and affordable alternative to invoice financing
Fixing up uninhabitable homes to be resold
Purchasing properties at overseas options at rock-bottom prices
Eligibility for an international bridging loan is assessed near-exclusively on the viability of the applicant’s security, used to cover the costs of the loan. Even with poor credit and no specific proof of income, it is still possible to qualify for a competitive international bridging loan with independent broker support.
For more information on any of the above or to discuss your requirements in more detail, contact a member of the team at Bridgingloans.co.uk today.
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