There are times when you are just one step away from the “deal of your life”, and things just would not move up. Maybe you just wanted to move to a bigger, better house and the seller is ready to complete the deal. You thus decided to sell off your current house, identified a buyer but the deal has not yet gone through. A month's delay can put off your chances of moving and you are aware of it. While the time runs out, there is the Bridging Loans available to UK residents come to your rescue.

Bridging Loans are available to all irrespective of one is traditionally employed or self employed. Since there is the mortgage of the property being passed on, the lender is covered of the risk. Also since the loan is a rather short term, high value one, with a higher interest rate, even if one is self-employed, the lender is equally interested.

Let us look at the parameters involved with the bridging loans in greater detail. Bridging loans are short term loans which are used to bridge a shortfall in cash for a short period of time. More often than not, they are required to complete purchases of residential or commercial complexes. Bridging loans could be open or closed. A bridging loan is termed as open if the intent to buy and sell is there but the terms of the deals have not yet been agreed. The loan is closed if the terms and conditions of the deals have been finalized, yet there is some delay in moving on. In case of closed deals, the bridging loans are of an especially shorter duration.

The bridging loan is normally obtained by mortgaging the new property. The amounts in consideration are large – varying from £10,000 to £500,000 which is normally enough to cover the entire deal. The average duration of Bridging Loans in the UK is 6 months and in normal cases, it does not exceed an year. The important thing about bridging loans is that they are processed fast – normally the formalities are through within a month. Both the lender and the buyer understand the essence of time here.

Bridging loans are available to the self-employed with an equal ease. The amount of interest is a bit low if the credit history of the borrower is good, but the lender does not fuss about it since the loan is secured by the mortgage of the house under purchase. The amount that can be loaned depends on the valuation of the property which is normally a must in the case of a bridging loan. The interest rates are rather high – this being a short term loan. It is normally possible to hunt for one between 2-2.5% monthly interest, though the exact rate varies. A management fee is also normally levied on a bridging loan – this is up to 1.5% of the loan under consideration.

The point of importance here is that bridging loans can be obtained for purposes other than property purchases. The shortfall in cash can be for a wedding, a vacation, or for some other reason when you know that the amount is just around the corner – sticking on some deal about to get through or some bonus next month. Any property or land in England, Scotland and Wales can be used as a security for a bridging loan.

Thus, if there is a deal that is just about to get through or there is a shortfall in cash and an impending source is about to fulfill it, bridging loans can be looked at as an option. It helps you save that very important deal which could have gone by in a month's delay. Also, being self-employed is no criteria to feel that bridging loan is not an option. The interest rate is normally on the higher side but bridging loans can be obtained for larger amounts up to £500,000 and is processed rather fast given the importance of time for all parties. Monthly repayments are made as with all other loans and if paid on time, enhances your credit history.