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CW Asset Finance | Vehicle & Equipment Finance Yorkshire

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Are bridging loans a good idea?

Bridging finance is a short-term, higher-cost tool, not a cheap alternative to a term loan. It can be sensible when you need to move quickly and have a clear, realistic way to repay it. It is a poor idea if the exit is uncertain, because the cost mounts and the security is at risk.

It can work well where timing is the problem rather than affordability — completing on a purchase before a sale finalises, or funding work that makes a property suitable for a conventional lender.

It works badly as a way to plug a shortfall you have no defined route out of. If the sale or refinance does not happen, you face extension fees, higher charges and, ultimately, the lender enforcing its security over the property.

Bridging is almost always secured on property. If you cannot repay, that property can be repossessed and sold. Where directors give personal guarantees, personal liability sits on top of that.

Before recommending anything, we would want to understand your exit route and stress-test it. If a mainstream facility fits better, we will say so. Any decision rests with the lender and depends on your circumstances.

Thinking about it for your own business?

Tell us what you are looking to fund and we will search our panel of 60+ lenders. No credit search at this stage, and indicative decisions in as little as 24 hours.

CW Asset Finance is a credit broker, not a lender. Finance is subject to status and lender approval.