How do Bridging Loans Work?

Bridging loans are a short-term finance solution intended to ‘bridge’ the gap in your finances. They can be used for a number of reasons, but they hold the most weight as a funding solution when it comes to property. One of the most fundamental benefits of bridging finance is the speed in which the Bridging Loan can be in your account, which can be a matter of days rather than the months it can take for traditional mortgages to be completed. This can be extremely useful in a number of situations, including when buying at auction or trying to get a really great deal on a property, where a quick sale might sweeten the deal for the seller. You may also consider turning to bridging finance when selling your own home and embarking on the purchase of a new one. The strain and hold ups around waiting for funds from the sale of your property to come in before making payments for fees, stamp duty and so forth on the new property. Common reasons for using bridging loans on property purchases is because the property will be immediately sold on (flipped) so a long-term mortgage arrangement is not suitable, or the property is in disrepair so a traditional mortgage would not cover the initial costs. In the second scenario you may find that a bridging loan will cover you for the first year so that the property is then in a fit state to mortgage later down the line.

So, how do they work?

They are a short-term finance solution, so you wouldn’t usually find them having longer than a 12 month term.

A Barclays bridging loan or bridging loan from a mainstream lender will usually provide you with a loan on an LTV of 70% but depending on the circumstances there are options for 100% LTV bridging finance. Working on a 70% LTV, this roughly means that you will be able to borrow 70% of the value of the property. Depending on the lender the value of the property could be; the amount you purchased it for, the current market value in its current state or in some cases the estimated market value once the project has been completed.

They do tend to have higher interest rates than traditional mortgages. You can usually find a traditional mortgage with under 4 percent interest whereas a bridging loan will average between 8 and 15 percent. It is important to consider the interest rates when deciding if  bridging finance is right for you and there are brokers and tools out there to help you, you could start with the NatWest bridging loan rates calculator to give you an idea.

There are different ways to pay the interest so make sure you look for a provider who offers you the payment options that work best for you. Usually, you will pay interest each month and then pay the loan amount off at the end of the loan term. However, some providers offer you the opportunity to pay the interest of at the end of the project as a lump sum and some lenders withhold the cost of the interest. If you agree a loan where the interest is withheld, you will receive the funds minus the interest at the beginning of the agreement, so it could leave you slightly low on finance in the short term dependent upon your circumstances.

As with most lending options you will find the interest is not the only cost implication. With bridging loans, you might find there are also application, survey, valuation fees and more so be sure to check this out when deciding on a lender.

In short, bridging finance can, in the wrong hands, be a costly funding solution. It does however have a number of benefits that can far out way the cost. It is likely to actually save you money overall if it means you can act quickly on a property purchase to secure a really good deal. Therefore, in the right hands and with the right research bridging finance can be an exceptionally tool to have in your belt.

Your Property’s Garden: Asset or Liability?

When renting a property, the look of the place still places a big part in the decision about whether to rent or not. While not as important as when buying a property, many tenants look at the house and its gardens to help them make a choice. But does this make the garden an asset or a liability?

Smart Appearances

A good, well maintained garden can help ‘sell’ the house to a lot of tenants. For example, older couples may enjoy gardening and the gentle activity is good for their health. Couples with kids will view a well maintained lawn area as a place for a spot of football or for the kids to pitch their tents. A decked or patio area can provide a perfect setting for outdoor entertaining or simply somewhere nice to sit and relax on a sunny evening.

A garden can work against you when it goes to two extremes – ultra fussy or poorly kept. A garden that takes serious hours to maintain may put off a lot of tenants unless they too are garden fanatics. Therefore, keeping things relatively simple is ideal. However, a shabby garden that is overgrown and full of weeds will put off even non-gardeners because it looks a mess and makes them think they will need to sort it all out.

Trees & Tree Surgeons

Another important area to take into consideration with your property are any trees on or surrounding it. Trees create a beautiful backdrop to a garden but can also be a hazard. Therefore, getting in a professional tree surgeon to assess the trees on the property before putting it up to rent is a good idea.

For starters, some insurance companies can be funny about trees. Too big or too close to the house and they can invalidate insurance policies. This is due to the danger of them falling into the house in a storm or their roots causing subsidence. Therefore, regular maintenance of the trees is a good idea and this is where an experience tree surgeon will come in.

A visit from such a specialist will help you know if the trees need minor or serious work, how often and if they present any real problems. Plus, it keeps the trees looking smart – out of control trees can block the light from the garden and even from the house. Overgrown trees can even cause issues with neighbours if the tree is blocking their garden or house and lead to disputes.

Whose Job?

Once the tenant is in place, does it then become their job to maintain the garden? This is an area that should be covered in the tenancy agreement to avoid disputes. Some landlords employ a good gardener and part of the cost of this is included in the price of the rent. Some tenants enjoy a spot of gardening and agree to keep everything neat and tidy. However, a landlord can’t hold a tenant responsible if plants die or the lawn doesn’t thrive so if the garden is such a big thing to the landlord, ensure you get a fellow gardening fanatic in as a tenant!

Climb the Stairs to Higher Profits

Staircases are often seen as one of the most functional parts of a house, used to pass between levels.  But there’s nothing that says staircases need to be simply functional and can instead be decorative, unusual or even offer extra benefits.  And with these innovative styles of staircase, you can increase the value of your property, make it more appealing to buyers or even to potential tenants.

Choosing a style of staircase

When you plan to spend money on renovating or changing the staircase in your property, then there are a few things to consider.  The steepness of the stairs is something that can be a big problem for some potential buyers or tenants, especially if they have children or older family members.  A flowing, gentle staircase may be more attractive for these people.

In other homes, the look of the staircase is crucial.  Open plan living is a big trend and this often means that the staircase is in the living room.  Therefore, people are often drawn to styles that look great, allow plenty of light to flow from upstairs and is an attractive feature in the room.

Finally, always consider the safety aspect of any staircase and have it designed by experts.  You need to be certain that it fits within building regulations and offers the safety features you are required to include for rented properties.  Even if you don’t plan to sell the house, you still want to reduce the risk of an accident on the stairs as much as possible by using the right safety elements at all times.  A good staircase designer will flawlessly incorporate these into the design to make them harmonious and equally attractive.

Helical staircases

Helical staircases are often used in apartments, hotels and entrance areas to create a feature of the staircase while using less room than a traditional straight style.  Helical staircases don’t need a newel and there are handrails on both sides.  As well as being circular in shape, they can also be elliptical or oval in shape and the design means you can even have two different designs of helical staircase in the same space.  Experts in making these staircases often offer custom built styles to ensure they exactly match your space.

Metal staircases

Steel & metal staircases have often been associated with functional, exterior styles but the modern variations are also great for indoor areas of the home too.  There are a number of different designs that work in this material including straight, quarter landing and half landing styles and a single area of stairs can be up to 16 in number so can cover a range of spaces.  These materials can result in bespoke staircases that are very modern in appearance and also very strong.

Glass staircases

Cantilever glass staircases are at the very cutting edge of modern looks and offer that almost-invisible style that looks great in modern or recently renovated properties.  These ultra-sleek looking staircases use special glass that is tempered, laminated and chemically treated to make it strong enough for the job and can be combined with steel and metal elements to create the look you want.


The Landlord’s Holy Grail: Trustworthy Tradespeople

Unless you are incredibly lucky and multi-talented, as a landlord you will need trustworthy tradesmen at some point. Whether this is for the plumbing, drainage, heating, roofing or just a general handyman, knowing the right people to turn to when something goes wrong is important. So composing a list of plumbers, heating engineers and electricians is a crucial step to being a successful landlord.

Getting the Right People

Of course a list of names and telephone numbers is one thing but how do you know someone is trustworthy and reliable? There are a number of ways to do some detective work on potential workmen that can enable you to make a confident decision about who to employ.

Word of mouth in this internet age still has a place. Ask friends and family for recommendations about the people they have used for their own homes – and for people with whom they have had a bad experience. If you know other landlords, ask them who they use for their work if they are in the same area as you.

Next, do some research on the internet. There are loads of comparison type websites now where tradesmen can advertise their services and you can contact them via email or the phone. Many of these sites also allow customers to leave reviews and ratings, giving you a feel for their experience. Trading Standards website also has a postcode search facility that lets you find tradesmen in your area while the Local Authority Assured Trader Scheme Network is another similar option.


Another scheme designed to root out the bad apples and ensure good quality tradesmen is the TrustMark. This is a government back not-for-profit scheme where you can go to the website, put in your area and what work is needed and their database gives you suggestions. These people will have had their skills independently checked as well as their work inspected, will have signed up to a code of practise and will have the right insurance and safety practises in place.

WaterSafe is a similar version that has been established for plumbers and has the backing of all the major water companies including the Trading Standards Institute and Gas Safe. Work done by a WaterSafe plumber comes with a Work Completed Certificate that ensures their work is to the required standard.

Talking to Tradesmen

By using these services, you greatly increase the chance you get a trustworthy tradesman but it never hurts to talk to them and ask a few key questions. Talk to them about the insurance they have, for example, as even the best tradesman can suffer an accident. Look at the qualifications they have or examples of their previous work, especially on large projects such as kitchen refitting or bathroom renovation.

Finally, all quotes that you get, ensure they are in writing and detail how long they are valid for. Only pay for work that has been done unless the tradesman requests payment for parts beforehand which some may do. Never pay the bill in full before the work is done.

Finding the Best Property Deals

So you have decided that you want to invest your money in property and the buy to market, despite recent gloominess, looks the way to go. While there have been bumps in the road recently with new government legislation among them, there is still a massive demand for rental properties as people cannot get mortgages and local authority properties are scarce. The first step is getting the best property deal but where should you look?

Traditional routes

For a lot of landlords, the estate agent is still their best friend when it comes to finding the right properties and getting the best deals. So if you plan to buy a property in East London, for example, then you should make contact with East London estate agents. Let them know what kind of property you are looking for, what kind of budget you have and any other information you have – the more they know, the better they can work.

Another traditional route to find the best deals is to look at property auctions. While these might seem outdated in the internet age, they still serve a purpose. If you have the cash ready to go and are willing to do a bit of bidding to get the right property, you can pick up a bargain. Remember these properties often need a bit of work doing to be liveable but if you are up for this, then this is a route to consider.

Modern alternatives

A big growth area in recent years has been the quick sale house company who offer to buy up properties far quicker than an estate agent could manage. The down side of this is that they often get the seller less than the market value. As a buyer, this might mean you can get a bargain with the cost of the house but make sure you are very clear upfront what the company will charge for this service and have all the terms reviewed by a solicitor – there are genuine companies out there in this market but unfortunately also less genuine ones.

The internet is a source for information for every aspect of our lives and finding the best deals on property is one of them. Sign up with all the big names in property sales and register your interest in an area and for buy to let properties. It is similar to working with an estate agent, apart from the fact that you don’t get the face to face service and you can’t sit down with someone in person to review everything.

Buying new properties

Recognising the need for rental properties, some big names in home building have also started to sell properties specifically for the job. Barratt Homes is one example and they have a whole area of their website dedicated to landlords who are looking to buy one of their properties to rent out. They offer various schemes to make this more appealing such as their Leaseback scheme to give guaranteed rental income and this might be a step worth considering for new landlords.



3 Ways to Make Money from an Empty Property

The empty house is a situation that a landlord often faces. One tenant has moved out and for whatever reason, another one isn’t moving in yet or has yet to be found. So what can landlords do when they are between tenants to make money from an empty house?

Why Empty is a Problem

Empty houses may not, on the surface, seem such a big drama, especially if it is only empty for a matter of a few weeks. But remember that even an empty house still needs the mortgage paying and the council tax is still required, whether anyone lives in it or not. Then there are the utilities – especially in winter, the heating will need to be kept on to a minimum to avoid pipes freezing up so these bills will need to be paid by the landlord.

Insurance is another reason that empty houses can be a pain. Most companies will give you 30 days between tenants where the house can be left on a normal policy but after that, you will have to cancel your insurance and take a more expensive, more restricted unoccupied property insurance.

Location Agency

So what can you do when the house is empty to continue using it and making money? Depending on the type of house and the location, you may be able to rent it to a TV or film crew to use in their production. This is a growing industry around the world and doesn’t need a massive country manor to have a chance. Many films and shows use ordinary homes as sets and crews find it cheaper to rent a real property than construct a set of one.

The main downside of the idea is that it can be complicated to arrange but there are a number of location agencies around the country who help find the perfect photoshoot locations London film companies and magazines are always looking for, who can act as a go-between. They can find the right crew who need your type of property and arrange all the payment and legal side.

Short Term Rent for Holidays

Short term rentals for days or weeks are a big hit at the moment with the popularity of sites such as Airbnb increasing on a daily basis. The idea is simple – rather than renting out the house to someone as their permanent home for six or twelve months, you rent it to someone staying in the location for a day, week or a few weeks. Then when you have a permanent tenant lined up, you take the property off the short term rent market.

The main downside of the option may be that there is no real guarantee of someone wanting to rent your property but if there is no tenant in place, it may be a risk worth taking.

Short Term Rent for Business

A similar idea may be to rent to property out to business people who need to stay in a location for a period of time. They might be working on a project for a few months or even just weeks but want somewhere they can bring their family and that isn’t a hotel. Again, demand can be variable but something is better than nothing when you have a mortgage to pay!