Short-Term & Bridging Loan Refinance

Bridging loans are a great short-term solution for businesses that need fast cashflow injections in order to resolve issues or capitalise on opportunities. In the property world, they’re typically used to help pay for properties you win at auction. While they offer a rapid route to shoring up your finances, they tend to come with higher repayments and interest rates compared to term loans. 

Once you’ve bought the property or grown your business, a bridging loan may now seem like a restrictive repayment that punishes you for your past situation. Instead of accepting the situation, why not take matters into your own hands and consider refinancing?

Refinancing a short-term bridging loan into a longer term loan will help reduce the monthly repayments you have to make, freeing up capital for you to use elsewhere in the business. In most cases, the new loan will also come with a lower interest rate and more support from your lender. 

Whether you refinance from your existing bridging finance lender to a new one, or simply move between loan products with the same lender, Rangewell will step in and act on your behalf to help you secure the best loan for your needs. 

Take a look at some of the situations in which a bridging loan refinance deal may be right for you. 

Property auction refinancing

Property developers tend to capitlise on opportunities at auction through bridging loans. Lenders will offer finance based on the property’s short-term value and at a higher rate than a term loan, but in a rapid agreement that sees funds delivered in time for you to pay for your auction win. 

However, once you’ve bought the property, you could find a lender willing to refinance to a term loan that is based on the property’s longer-term value and on your new status as owner. If you’re an experienced developer, that will also count in your favour and can help you secure better rates. 

In some cases, loans can also be refinanced into a larger facility – meaning you’ll get more cash to use to refurbish the property or grow your business elsewhere. So, rather than simply accepting the bridging loans strict repayment schedule, talk to our team to refinance your loan for your new auction win and give your property portfolio a boost. 

Bridging loan refinancing following change of use

One of the most appealing parts of refinancing is being able to access more preferential rates once the initial purchase or reason for your bridging loan has been accomplished and your business or property’s value has risen. If you do nothing, you won’t get to reap the rewards associated with increasing said value, so refinancing is worth exploring. 

In property development, this opportunity often presents itself when a developer buys a property with a bridging loan and then transforms it via Change of Use into a HMO, care home or other specialist residential property. When you’ve done the work to secure the property and outfit it, you’ll be able to access better financial products due to the increased value of your business – but only if you refinance. 

We’ll help you take your bridging loan and refinance into one more suitable to your new building’s value. Where a short-term loan may be secured against personal assets or the initial auction value of the property, a longer-term product is instead valued against the business and will therefore offer more favourable terms. 

Refinance other short-term property loans

Short-term loans can help get you through difficult times. Whether you’ve encountered unexpected costs such as a new boiler or property rewiring, or your property is vacant, and you are unable to meet the utility costs. A short-term or bridging loan might be just the ticket. 

If you’ve taken out a loan like this and are now struggling to repay it, or would rather repay over a longer period, then you might want to consider refinancing in order to consolidate debt and make your loans work for you. 

In some cases, your business position may even worsen and you may then assume you can’t refinance to a better arrangement – but that’s not always the truth. At Rangewell, we’ve helped business owners who are facing challenging short-term loan repayments spread the cost via a refinancing agreement.  

If you’ve taken out a short-term bridging loan, refinance with Rangewell to reduce your overall interest rates. We’ll help make repayments more affordable and find a lender willing to refinance in a way that’s aligned with your business’s growth.