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While there may be no shortage of specialist development finance products available in the UK, most are restricted to individuals with extensive experience and a well-established presence in the field. Something that can (and often does) count inspiring and ambitious newcomers out of the running

This is where bridging loans have the potential to offer a more flexible and accommodating alternative, issued almost entirely on the basis of available security and a feasible exit strategy.

How does a bridging loan work?

A bridging loan is a type of short-term financing, generally lasting between six months and two years. It’s designed to “bridge” the gap in funding that can occur during the purchase or development of a property, enabling the developer to keep their own cash as liquid as possible for the duration of the project.

The flexibility of bridging finance has made it a go-to option for a broad range of purposes, including:

• Buying properties at auction to fix up
• New ground-up property developments
• Conversion projects (residential and commercial)
• Renovation or refurbishment of properties
• Purchase of land for development

The lender secures the loan against the value of the property or development, and once it is sold or alternative financing is secured, the loan is repaid in full.

Why is bridging finance a great choice for property development?

Ease and speed of access to funds are two of the biggest points of appeal with bridging finance, which can make a significant difference in property development.

Bridging loans, sometimes called property development loans, are designed to fulfil the needs of developers at short notice, allowing them to cover unexpected costs and take full advantage of time-critical purchase or investment opportunities.

Just a few of the potential benefits of bridging loans for property developments include the following:

Super-fast completions

Unlike traditional loans, which could take weeks or months to finalise, bridging loans, once approved, can be completed within a matter of days, sometimes just 72 hours. This is particularly beneficial in competitive business landscapes like property development, where time is of the essence.

Competitive rates

Monthly interest rates can be as low as 0.5%, making for unbeatable value for money when the debt is repaid early. Unlike longer-term loans, where compounded interest can quickly escalate, the short duration and competitive rates of a bridging loan keep costs down.

Flexibility

Unlike most conventional property development loans, bridging lenders do not impose heavy penalties for early repayment. In fact, most encourage early repayment to enable the borrower to save money.

No monthly repayments

The interest on a bridging loan is typically ‘rolled up’ until the end of the term, which means there are no monthly repayments to consider during the term of the bridging loan. This can significantly aid cash flow, particularly vital in property development where funds are generally tied up in the actual development.

Covers a range of expenses

From purchasing land to covering construction costs to renovation expenses, a bridging loan can cover a wide range of costs associated with property development.

Bridging vs. development finance

In essence, bridging loans mirror many of the features and benefits of specialist development finance, only with the added bonus of greater accessibility and flexibility. If you are able to provide your lender with formal evidence of the value of your property or project and a convincing exit strategy (how and when you intend to repay your debt), you have a higher chance of qualifying, irrespective of your experience in the field.

Plus, whereas property development finance is released in a series of stages tied to the completion of major project phases, the full balance of a bridging loan is transferred to the borrower in a single lump sum.

This alone can make it a preferable option for many property developers, who would prefer not to have to wait for subsequent instalments to be released.

Inheriting assets in the wake of bereavement can sometimes feel more like a curse than a blessing. The UK’s approach to probate loans and inheritance taxation is notoriously complex.

Getting your inheritance can sometimes turn out to be more of a headache than a windfall, especially when the process involved, known as probate, gets drawn out over weeks or even years.

But what if there was a way to access a portion of your inheritance upfront without having to wait for the seemingly endless probate process to finish?

Potential problems with the probate process

After the passing of a loved one, the last thing anyone needs is a raft of legal and financial complications. Unfortunately, probate brings both into the mix. and in no small measure.

Difficult at the best of times, the process can get dragged out further due to disputes over the will, outstanding debts, property sales, or simple administrative delays. During this period, rightful beneficiaries may find themselves facing a dead end, unable to access the inheritance due to them.

Introducing probate advance

While such circumstances can leave you feeling helpless, there is a solution that can offer some relief: a probate advance. This bespoke service enables beneficiaries to receive a portion of their inheritance early, usually within a couple of weeks at the most.

Probate advance, also known as inheritance advance or estate advance, is a swift and affordable way to access some of your owed inheritance without waiting for the probate process to finish. It is essentially a secured loan, wherein the assets you are owed are used as collateral for the facility.

You may be able to access anything from 60% to 80% of your owed inheritance in advance, at the cost of a low monthly rate of interest in the interim.

How does probate advance work?

The process of obtaining a probate advance loan is fairly straightforward, consisting of the following steps:

1. Application: The process begins by applying for a probate advance with a reputable company, ideally via a specialist broker. The application usually requires minimal paperwork. Typically, a copy of the death certificate, a will, if applicable, and some basic identification
2. Evaluation: The lender will then assess the estate and perform due diligence. They will validate your inheritance claim and the value of assets in the estate.
3. Agreement: Once verified, the lender will offer you an advance, typically a percentage of the inheritance you’re owed. You’ll receive a contract outlining the terms and conditions.
4. Transfer: After the contract is signed, the advanced amount is wired to your bank account within a few days, which you are free to use as you wish.

The benefits of probate advances

Sourced from a reliable and reputable provider, a cost-effective probate advance can offer a broad range of benefits.

Examples of these include:

• Fast Access to Funds: Probate Advance provides you with immediate financial relief during a challenging period, thereby reducing financial stress.
• No Repayment Obligations: Unlike a conventional loan, there’s no obligation to repay the sum before you gain access to your inheritance, which makes it an attractive option for many beneficiaries.
• Credit Status is Not an Issue: The advance does not depend on your credit score or financial history. The main matter of importance is the value of the inheritance you are set to receive.
• Avoids Family Conflicts: As every beneficiary can apply for their share, it prevents potential family disputes over access to the inheritance.

Making the right decision

Choosing the right financial support during a particularly sensitive time can be challenging, but it is important to consider all available options before making your decision. While probate advances offer a fast, flexible, and affordable solution, it’s crucial to balance this against any potential costs or drawbacks.

Your aim should be to ease financial stress during a difficult time, not add to it. Precisely the input and support of an experienced broker can prove invaluable. Along with helping you choose the ideal products to suit your requirements, your broker will pair your case with the best available lender and negotiate hard to ensure you get an unbeatable deal.

For more information or to discuss the potential benefits of probate advance in more detail, contact a member of the team at UK Property Finance today.

It can be more than a little frustrating when you are counting on an inheritance that is rightly yours, but the probate process seems to drag on endlessly. Even today, bringing all legal, and financial matters to a swift conclusion in the wake of the death of a loved one can be surprisingly (and disappointingly) complex.

Not to mention, cripplingly expensive.

In such circumstances, a small inheritance advance could be the lifeline you need to navigate these complications. But how exactly does an inheritance loan work, and who is eligible for such facilities?

What is a small inheritance advance?

A small inheritance advance, also known as an inheritance loan or probate advance, is a financial product that allows heirs, and beneficiaries to access part of their inheritance money, before the conclusion of the probate process. Instead of waiting for months (or even years) to receive your inheritance, an advance offers immediate access to a percentage of your entitled assets.

Lenders typically cap their maximum loan amounts at 60% to 80% of the total value of the assets you own, which means you could gain access to a significant sum of money much faster.

Who could benefit from a small inheritance advance?

Anyone who needs (or wants) to gain access to their inheritance prior to the completion of probate could benefit from a small inheritance advance. Potential applications for such funds are limitless, but common uses for probate advances include:

• Immediate financial needs: If you have urgent bills to pay or time-critical costs of any kind, an advance could be a useful option.
• General purchases: You may also simply want to gain access to the funds that are rightfully yours to purchase a car, pay for a holiday, invest in a second home and so on.
• Debts and obligations: The funds from an advance can be used to settle debts, business bills, or other major expenses.
• Investment opportunities: An opportunity for a good investment might not wait for probate to conclude, and an inheritance advance may just provide the needed funds.

In short, a small inheritance loan can be used for any legal purpose, with no specific restrictions imposed.

Eligibility for a small inheritance advance

Requirements vary significantly from one lender to the next, but the following generally apply in all instances:

• Probate must be open: For a beneficiary to qualify, probate on the decedent’s estate must have begun.
• Verification of inheritance: You must show proof of your rightful claim to an inheritance.
• Proof of Inheritance value: The advance is typically a percentage of the inheritance value.
• Aged 18 years or over: Though there is typically no upper age limit.
• Good credit: Some lenders will only accept applications from individuals with a good credit score.

Along with the above, there are several potential complications that can hinder a probate advance application, or render an applicant unviable. Examples of these include:

• Insufficient estate value: Only beneficiaries who stand to receive a substantial amount can usually qualify.
• Not all estates are eligible: Some types of assets and other issues may disqualify the estate.

You must also be able to meet the required costs of a small inheritance advanced, which along with the agreed rate of interest may include an arrangement fee of around 1.5%.

Why use an independent broker?

An inheritance advance can offer a lifeline in a period of concern and complexities.

Using a reputable independent broker to secure a small inheritance advance can ensure you get the best possible deal while offering the objective advice you need to make an informed decision. They can provide different options from various lenders (some of which do not work directly with borrowers), helping you make a well-informed choice and negotiating on your behalf.

For more information or to discuss the potential benefits of inheritance advance loans in more detail, contact a member of the team at UK Property Finance today.

Can I Get a Small Inheritance Advance?

It can be more than a little frustrating when you are counting on an inheritance that is rightly yours, but the probate process seems to drag on endlessly. Even today, bringing all legal and financial matters to a swift conclusion in the wake of the death of a loved one can be surprisingly (and disappointingly) complex.

Not to mention, it is cripplingly expensive.

In such circumstances, a small inheritance advance could be the lifeline you need to navigate these complications. But how exactly does an inheritance loan work, and who is eligible for such facilities?

What is a small inheritance advance?

A small inheritance advance, also known as an inheritance loan or probate advance, is a financial product that allows heirs and beneficiaries to access part of their inheritance money before the conclusion of the probate process. Instead of waiting for months (or even years) to receive your inheritance, an advance offers immediate access to a percentage of your entitled assets.

Lenders typically cap their maximum loan amounts at 60% to 80% of the total value of the assets you own, which means you could gain access to a significant sum of money much faster.

Who could benefit from a small inheritance advance?

Anyone who needs (or wants) to gain access to their inheritance prior to the completion of probate could benefit from a small inheritance advance. Potential applications for such funds are limitless, but common uses for probate advances include:

• Immediate financial needs: If you have urgent bills to pay or time-critical costs of any kind, an advance could be a useful option.
• General purchases: You may also simply want to gain access to the funds that are rightfully yours to purchase a car, pay for a holiday, invest in a second home, and so on.
• Debts and obligations: The funds from an advance can be used to settle debts, business bills, or other major expenses.
• Investment opportunities: An opportunity for a good investment might not wait for probate to conclude, and an inheritance advance may just provide the needed funds.

In short, a small inheritance loan can be used for any legal purpose, with no specific restrictions imposed.

Eligibility for a small inheritance advance

Requirements vary significantly from one lender to the next, but the following generally apply in all instances:

• Probate must be open. For a beneficiary to qualify, probate on the decedent’s estate must have begun.
• Verification of inheritance: You must show proof of your rightful claim to an inheritance.
• Proof of inheritance value: The advance is typically a percentage of the inheritance value.
• Aged 18 years or older: Though there is typically no upper age limit,
• Good credit: Some lenders will only accept applications from individuals with a good credit score.

Along with the above, there are several potential complications that can hinder a probate advance application or render an applicant unviable. Examples of these include:

• Insufficient estate value: Only beneficiaries who stand to receive a substantial amount can usually qualify.
• Not all estates are eligible. Some types of assets and other issues may disqualify the estate.
• You must also be able to meet the required costs of a small inheritance, which, along with the agreed rate of interest, may include an arrangement fee of around 1.5%.

Why use an independent broker?

An inheritance advance can offer a lifeline in a period of concern and complexity.

Using a reputable independent broker to secure a small inheritance advance can ensure you get the best possible deal while offering the objective advice you need to make an informed decision. They can provide different options from various lenders (some of which do not work directly with borrowers), helping you make a well-informed choice and negotiating on your behalf.

For more information or to discuss the potential benefits of inheritance advance loans in more detail, contact a member of the team at UK Property Finance today.

Contrary to popular belief, a bridging loan has the potential to be a surprisingly simple and versatile funding solution. No longer confined to commercial borrowing circles or big business, bridging finance has well and truly hit the mainstream as of late.

But how exactly does bridge finance work in practice? More importantly, who can qualify for bridging loans, and when is taking out bridging finance a good option to consider?

How bridging loans work

The best way to understand how bridging loans work is to consider a couple of everyday scenarios:

Scenario 1. Bridging loans for property chain breaks

• A homeowner with £500,000 equity in their home applies for a bridging loan of £300,000
• The loan is secured against their current home and the funds are released within a week
• This enables the borrower to purchase their next home (on sale at £300,000) for cash
• Their previous home remains on the market until it sells for its best possible price
• When their previous home sells a few months later, they repay the loan in full
• Interest accrues at a rate of around 0.5% in the meantime and is repaid along with the loan balance
• By taking out a bridging loan, the borrower was able to avoid the risk of their planned property purchase falling through

Scenario 2. Bridging loans for property purchase, renovation and sale

• A property in a poor state of repair is put on sale at auction for much lower than its potential market value
• An investor places a bid on the property and is successful, but must come up with the full payment within 28 days
• They take out a bridging loan against their own home or another property they own, accessing the funds promptly
• The loan is used to purchase the property and cover the costs of all subsequent renovations
• A few weeks or months later, the property is sold for its full market value to a new buyer
• The investor then repays the loan in full and retains all additional profits

In both instances, the borrower benefits from rapid access to a significant sum of money, enabling them to make a purchase that would be impossible with most conventional borrowing products.

Who is eligible for bridging finance?

Along with the flexibility and affordability of the facility, accessibility is another major point of appeal with bridging finance. Eligibility criteria are comparatively relaxed, at least when held alongside a typical mortgage or personal loan application.

The main requirement is ownership of assets of value to offer as security for the loan. For example, if you own a home with a value of £500,000, you may be able to borrow up to 80% of this value (at 80% LTV), which would be £400,000. Without adequate security, you cannot take out bridging finance.

Other than this, you will need to present your lender with evidence of a workable exit strategy, for example, how and when you plan to repay the loan. For example, if you are buying a property to renovate and sell, your exit strategy would be the subsequent sale of the property.

With viable security and a convincing exit strategy, you have a high chance of qualifying for bridging finance. Even if you have imperfect credit and/or no formal proof of income, you may still be considered for a bridging loan.

However, in all instances, it is advisable to apply via an independent broker, who can help pair your requirements with an appropriate lender. The UK’s network of bridging loan specialists is growing at its fastest pace, making the input and advice of a skilled broker more valuable than ever before.

For more information on any of the above or to discuss the pros and cons of bridging loans in more detail, contact the team at UK Property Finance anytime.

At the risk of jumping straight to the conclusion, no financial product is an effective one-size-fits-all solution. The whole thing is highly circumstantial, based entirely on your requirements at the time, coupled with what you can comfortably afford.

Bridging finance is no different, which in some instances can be no less than a godsend. One of the most commonly misunderstood financial products to have hit the mainstream market as of late, bridging finance has the potential to be uniquely versatile, accessible, and even affordable.

Again, in the right instances and when taken out under the right circumstances.

How do bridging loans work?

Perhaps the simplest way to think about a bridging loan is as something like a very short-term mortgage. Bridging finance is issued in the form of a secured loan, typically against a home or commercial property. The amount you can borrow is therefore tied to the value of this security, typically up to a maximum LTV of 80%.

So, if you have built up £250,000 of equity in your home, you could borrow up to £200,000.

The key difference is that with a bridging loan, the funds can often be accessed within a few working days. After which, the loan is repaid in full no more than a few months later, in a single lump-sum payment plus borrowing costs.

Monthly interest can be as low as 0.5%, adding up to a very competitive form of borrowing when repaid promptly.

When is a bridging loan useful?

There are countless scenarios where this kind of fast-access, short-term cash injection could be hugely valuable.

Typical applications for bringing in finance include the following:

• Refurbishments: A short-term loan can be just the thing to cover the costs of renovations or repairs, prior to selling or letting out a property to maximise its value.
• Chain Break: Homebuyers can use bridging finance to ‘bridge’ the gap between buying their next home and selling their current home, avoiding potential chain break scenarios.
• Property Development: Construction companies and developers often turn to bridge finance to cover their short-term funding requirements while conducting projects.
• Auction Purchases: Bridging finance provides an affordable way to meet the 28-day payment requirements of auction houses when purchasing properties.
• Inheritance Tax (IHT): If you need to pay a large IHT bill in order to gain access to your inheritance, you could take out a bridging loan and repay it when you receive your money.

In short, anytime you need a sizeable cash injection in a hurry and can comfortably repay the loan within a few months at the most, bridging finance could be just the thing.

What are the benefits of bridging loans?

Bridging finance holds four main points of appeal when compared to the vast majority of mainstream loans and funding solutions:

• Fast: If you submit a strong application complete with all required evidence and documentation, the money you need could be in your hands within 3 days.
• Flexible: There are no limitations placed on how you can allocate the funds you receive, as is often the case with other types of loans.
• Accessible: It’s possible to qualify for bridging finance with no formal proof of income and even a poor credit history.
• Affordable: Charged at as little as 0.5% per month, a promptly repaid bridging loan can be a surprisingly cost-effective option.

Just as long as you have sufficient assets of value to offer as security and a viable exit strategy, you have a good chance of qualifying for a bridging loan.

When is bridging finance not a good idea?

As with all secured loans, risks apply when taking out bridging finance. If you are unable to repay your loan as agreed, your asset (i.e., your home or business property) could be repossessed.

In addition, bridging finance is only affordable when repaid promptly; therefore, it should never be taken out as a longer-term solution. If you have the slightest doubt as to your capacity to repay the loan in full and on time, you should not even consider applying for bridging finance.

For more information on any of the above or to discuss the pros and cons of bridging loans in more detail, contact the team at UK Property Finance anytime.

Being a named beneficiary of a deceased person’s estate often brings unexpected obstacles and financial burdens. One of which could be your obligation to pay inheritance tax (IHT), which, depending on the size of your inherited estate, could amount to a major headache.

With the current IHT threshold in the UK standing at £325,000, IHT bills can often amount to sums that are simply insurmountable. Beyond this threshold, you will need to pay an IHT of 40% of the combined value of all assets you will eventually take ownership of.

To gain legal access to your inheritance, you may have to look for ways to finance these bills with third-party support. This is where probate bridging loans can come into play as an accessible, affordable, and convenient option.

Understanding probate bridging loans

Probate bridging loans, one of many types of specialist inheritance loans, are a type of short-term loan that beneficiaries can use to pay off IHT and other related expenses, such as probate costs and legal fees.

As the name suggests, they are designed to ‘bridge’ the financial gap between the time the inheritance is announced and when it is actually received, which can often be a lengthy process. Sometimes several months or even years.

The benefits of probate bridging loans

There are several unique features and benefits that have made probate bridging loans an increasingly attractive option for beneficiaries as of late:

• Fast Funds: Unlike regular mortgage loans that might take extended periods for approval and disbursement, probate bridging loans can be arranged in a few working days. This is particularly helpful when beneficiaries need to meet urgent tax obligations.
• Flexible Loan Size: Probate bridging loans have no maximum loan size, meaning the amount you borrow is tailored to your unique needs and is usually based on the value of the inherited property.
• Competitive Rates: Interest rates for these loans can start as low as 0.5% per month, making the borrowing costs much lower compared to long-term loans.
• Poor-Credit Applicants Welcome: Bridging loans do not discriminate against poor-credit applicants and often do not require proof of income. This opens the door for many beneficiaries who might otherwise struggle to qualify for a loan.
• Early Repayments: Most bridging loan lenders will offer the option to repay the loan early without incurring penalties, providing yet another benefit for beneficiaries.

Contact UK Property Finance

At UK Property Finance, we provide access to a broad range of specialist funding solutions for heirs and beneficiaries faced with an impossibly high inheritance tax bill. With our help and support, negotiating during one of life’s toughest times can be made much less daunting, with the representation and objective advice you need to make the right decisions.

For more information on any of the above or to discuss your requirements in more detail, call or email the UK Property Finance team anytime.