Martin Lewis and his website MoneySavingExpert (MSE) don’t suggest any particular lenders to use for bridging finance loans. The site provides the information to make a well-informed decision on what is best for you as a borrower. Using Martin’s bridging loan advice could be the game-changer to a successful short-term funding solution rather than a costly oversight.
Martin’s advice on bridging loans has a lot of clarity behind it. Bridging can be a high-stakes financial product that needs to be treated accordingly. MSE stress that there are a few key factors to be mindful of:
- Bridging loans are secured on property which means your home will be up for repossession if you fail to make repayments.
- Despite bridging finance being the best type of loan to get funds fast, costs can escalate due to the combination of interest rates and fees.
- Bridging loans are short-term leaving very little time to recover in the event of delays.
- It is imperative to have a plan in place to consolidate the borrowed monies.
The advice Martin Lewis provides a plain, practical approach as this financial product requires a meticulous plan and strong backing from a lender.
What it means when picking a bridging loan lender
Following the advice put forward by Martin Lewis, the focus shifts from “who is cheapest?” to “who is safest and most transparent?”
Secured finance on your propertyLend money against your propertyAs long as you own a home and need funds for investment or business, we can helpHow funds can be usedBusiness investmentCommercial purchasesProperty refurbishmentYes, I own a propertyHere is how Goldhill Finance stacks up:
1. Total cost clarity (not just headline rate)
The first advice given is to “look beyond the rate of interest.”
In the case of a bridging loan, the cost could include:
- Arrangement fees
- Legal fees
- Exit fees
- Monthly or rolled-up interest
The ideal lender will be the one that clearly states the total cost of borrowing, as opposed to hiding it in the fine print.
First and foremost, Goldhill Finance is committed to transparency. Borrowers know exactly what they are getting into, before they start.
2. Responsible lending (fast, and planned)
The advantage of bridging finance loans is the speed the loan can be completed. While speed is a significant advantage, it can increase the risk if pursued in isolation. This is where Martin Lewis ethos differs and included speed and transparency.
The lender should offer a balance of:
- Efficiency
- Due diligence
- Suitability
Goldhill Finance has a responsible approach to lending, where speed and efficiency are offered in the following ways:
3. A clear exit plan
A bridging loan should never be pursued without a clear means to repay it.
- Decisions in as little as 2 hours
- Desktop valuations are used to speed up the process
- Funds are available in as little as 48 hours after approval
Common repayment options:
- Selling the property
- Mortgage refinance
- Any other defined source of funds
Issues arise when there is a lack of clarity in the exit plan or when they are overly optimistic.
Exit plans are not taken lightly and are closely evaluated as part of the process.
4. Specialist knowledge (and experience)
Bridging finance usually involves working with:
- Complicated property situations
- Tight timeframes
- Unusual borrower situations
A typical ‘loan’ lender may not see the intricacy of the deal, but specialist bridging loan lenders have a more flexible approach. The key for a specialist lender is to understand the intricacy of each case.
5. Risk awareness (Not over-promotion)
At MoneySavingExpert, honesty and transparency regarding risk, is the core of their values.
This means being transparent about:
- Bridging loans are not suitable for everyone
- Bridging loans should have a specific purpose or aim
- Cutting corners on planning can lead to serious financial problems
Being transparent in this manner helps create trust, and everyone benefits in the long run.
A smarter approach to bridging finance
The basic concept, as derived from our examination of bridging finance from the Martin Lewis perspective, is as follows:
Bridging finance should be considered, not dismissed.
If used effectively, bridging finance can be a very successful option. However, the success of bridging finance depends on the way the loan has been arranged and by whom.
We provide consumer advice and guidance, as follows:
- Transparency
- Responsibility
- Practical know-how
- Speed (we provide the fastest completions in the UK)
Final thought
Following the same approach Martin Lewis advocates, can assist making a smarter decision and avoid unnecessary pitfalls or risk.
When it comes to bridging finance, choosing a lender that embodies speed, transparency, and exit planning in a responsible and informed way is the safest way to get the best product, and the best support along the way. It’s worth noting that Martin Lewis does not endorse any bridging finance lender and only provides advice on using the ideal type of lender.
