In the world of property development, securing the right financing can mean the difference between seizing an opportunity and watching it slip away. So, is this why bridging finance for land is becoming a common option for investors?
What Is Bridging Finance?
Increasingly, land developers are turning to bridging finance as a modern day solution to meet their immediate funding needs, but why?
This is because bridging finance is a short-term financing option that is specifically designed to provide immediate access to capital while waiting for longer term financing whether that be the sale of another property or securing a long term mortgage.
Fast bridging finance is commonly used in scenarios where time is of the essence, such as land acquisitions at auction or property development projects.
Some of the key features of bridging loans for land that make it an attractive options include:
Speed: Funds can be secured in as little as 24 - 48 hours with some of the most reputable lenders
Flexibility: Loans are tailored to suit specific project needs and timelines on a case by case basis
Short-Term Nature: Typically repaid much quicker than mortgages, typically in a matter of months
For land developers, bridging finance is a vital tool to quickly secure opportunities in a competitive market, making it grow in popularity in an ever growing competing space.
Why Bridging Finance for Land is Beneficial
Bridging finance offers distinct advantages that make it a preferred choice for land developers, especially when in comparison to lengthy mortgages.
A key issue is, when looking for an investment opportunity, particularly on costly assets such as land, it is important to consider that every penny counts.
This means jumping at land mortgages for instance without doing necessary research could see you making a commitment for 30 years due to pressing time constraints.
The good news is, quick bridging finance is designed to avoid these rushed decisions. A land bridging loan provides you with short-term financing even on highly costly purchases to ensure that you don’t miss the sale but still have the chance to secure a more appropriate long-term funding option.
The key benefits of utilising bridging and development finance include:
Quick Access to Funds: Land bridging loans prioritise speed, enabling developers to act fast on strategic land purchases. .
Flexibility for Unique Projects: Unlike traditional lenders, bridging finance providers consider unconventional projects, such as land acquisitions without planning permission or properties requiring significant development.
Overcoming Financial Hurdles: Land bridging loan providers focus on the value and potential of the asset rather than your credit history, making them accessible to developers facing credit challenges.
Capitalising on Auction Purchases: Many land acquisitions happen at auction, where immediate payment is required, as well as a fast turn around of 28-days to finalise the purchase. Buying land at auction means bridging loans empower developers to secure properties within tight deadlines.
The benefits of a fast turn around in land investment should never be overlooked, bridging loans have solved the issue of lengthy finance solutions so why not take advantage?
Lending for Land: Example Case Study
Consider this hypothetical situation, a property developer in the Midlands, who identified a prime piece of land perfect for their next residential project.
The land was up for auction, but their bank’s slow approval process risked losing this investment opportunity.
Then, bridging loan provider MS Lending Group stepped in with a tailored land bridging loan, allowing them to secure the land within days. With funding in place, they successfully completed their purchase and moved forward with development plans.
This is how land bridging finance can save investments from falling through, understandably, investments can be stressful without some level of security behind you and bridging finance can do just that.
How Land Bridging Loans Work
Understanding how bridging loans work is crucial before you choose this option, in a nutshell, this is what to expect when applying for bridging finance for land.
Step 1: Contact & Application
The first instance is to contact a reputable land bridging loan provider, this will allow you to chat with providers and understand if your situation would benefit from a bridging loan. Once this has been decided, you can move forward with an application.
Step 2: Documentation & Financial Plan Finalisation
Secondly, the land bridging finance provider will assess factors such as exit strategies, valuation of the land and term lengths. They will ask for relevant documentation to make an informed decision and financial plan.
Step 3: Approval & Funds Release
Finally, decisions are made quickly. There really is no time to waste since bridging finance for land is designed to get you a solution fast, once it is confirmed and a repayment plan has been agreed, funds are released and you can act competitively as a cash buyer.
Why Choose MS Lending Group for Your Bridging Finance Needs
At MS Lending Group, we understand the challenges and opportunities faced by land developers.
Our bridging finance solutions are designed with flexibility, speed, and expertise in mind. With our help, you can unlock funding quickly and confidently, ensuring you never miss a critical opportunity.
Contact us today to learn more about how our bridging finance services can support your next land development project.
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