A bridging loan is usually short-term finance for when you have purchased a new property but are yet to sell your existing property. The bridging loan helps you close the gap until you can access the equity through sale of your existing assets.
ASAP Finance offers a wide variety of bridging loan solutions for borrowers all over New Zealand. Cashflow timing gaps are natural occurrences in business; bridging these gaps can be the difference between securing your next big project or sitting on the side-lines.
Offering both open and closed bridging solutions, ASAP Finance gives you the confidence go unconditional on your next property as you wait to realise profits from a prior project or venture. Our short-term bridging loans are tailored to your individual needs, offering quick and hassle-free finance during the bridging period at competitive interest rates to suit the loan term.
Whether you are an investor looking to up-scale your investment portfolio or a property developer looking to secure your next big project, our team will find a solution that will suit your funding needs.
Key Advantages of ASAP’s Bridging Finance
- Bridging loans are typically capitalised interest loans and are intended to bridge a gap where increased debt makes servicing strenuous. We take advantage of our independence to structure bespoke bridging loans specific to the needs of our clients.
- We can assume security over one or both properties, with lending available against both the property being sold and the property being purchased.
- ASAP Finance has the ability and scale to lend $50,000,000 on a single transaction.
- Evergreen funding lines provided by ASB & BNZ are supported by private equity ensuring funding is always available for our clients.
- Our loans are settled quickly, often within 48 hours, so borrowers don’t need to be concerned about losing their chosen property while waiting for an approval.
- Take advantage of our term specific rates, with lower interest rates available for short term loans.
- We work with your financial adviser or mortgage broker to coordinate a sale and purchase timeline.
We offer two types of bridging loans:
- Closed: A closed bridge loan is one where you, as the developer or investor, have a known exit strategy in place. In this instance, you would (a) know how you will pay back the loan and (b) have a specific date that this will occur. For example, you may require funds to settle on the purchase of a new property before the sale of an existing property has been completed. In this scenario, you would have a binding sale and purchase agreement for your existing property. This gives both you and the lender certainty as to what funds will be available and when. Sale proceeds can then be applied to reduce debt against your new purchase. Exit strategies in closed bridge scenarios are clearly defined, giving it a lower risk profile than that of open bridge loans.
- Open: An open bridge loan is one where there is no clear exit strategy in place. For example, you are required to settle on a newly acquired property prior to procuring a binding sale and purchase agreement for your existing property. As you are yet to obtain a sale and purchase agreement for your existing property, there is no fixed date or guaranteed income, thus making it a riskier proposition for both you and the lender. ASAP finance provides short-term loans for a wide variety of open and closed bridging scenarios, enabling you to capitalise on the next opportunity that comes your way!
Our Bridging Loans Assessment
At times when property investors or developers need to settle a new property, bridging finance can be like a lifeline. The last thing you need is to be on tenterhooks for fear the deal will fall over. In the fast-paced world of property the saying time kills all deals has never been truer.
Our lending managers are experienced investors & developers, so we understand the need for a quick, hassle-free approach. Our loan assessment process is short and sweet.
What we review:
- Details of the security
- Your current loan balances
- Your proposed equity contribution
- Sale and purchase agreements
- Details of your proposed exit strategy
For more information on loan terms and funds, read our lending criteria.
ASAP Funding Process
- Submit a funding application. We work quickly, assessing your project and providing indicative terms in as little as 24 hours.
- Issuing of formal letter of offer. Following your acceptance of the indicative terms, we issue a letter of offer detailing:
- Our fees (including a legal quote for your solicitor)
- Your interest rates
- Loan terms
- Any terms and conditions (we try to keep these as minimal as possible) Unlike other lenders, our letters of offer are fully credit approved; we stand by our commitment to fund your project.
- Creation of loan documents. Once you have accepted the offer and paid the loan deposit, we work with your mortgage broker to arrange complete loan documents.
If you are working with a mortgage broker, we will pay brokerage direct, typically equivalent to 1% of the loan amount on drawdown. Our establishment fee and legal costs are payable by you. These are stipulated upfront.