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Bridging loans 'can be as safe for the lender as secured loans'

People looking to take out a bridging loan have a better chance of being accepted if contracts have already been exchanged, according to Moneyfacts.

Spokesperson Michelle Slade explained by this point in proceedings the lender is guaranteed to get their money back and so it is a safe investment for them.

She stated the loan provider will receive an income and a fee and "they would also have an opportunity to cross sell products to the customer".

When it comes to bridging loans, there are two main types – the closed bridge and the open bridge.

A closed bridge is exclusively available to homebuyers who have exchanged contracts for their existing property and an open bridge is used by buyers who have found a new house but have not put their current home on the market.

Homeowners looking to borrow money may find they get a better rate of interest on a secured loan as the risk to the lender is less because their property is used as surety.


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