Bridging Finance France

Bridging Finance France

Bridging Finance France

Bridging Finance France is usually short-term financial solutions though they are also used in a variety of other sectors for short term property lending with quick decisions. As the name implies, French bridging loans are used to bridge the gap between a debt coming due and the main line of credit becoming available; a common use is to purchase a property before a mortgage can be put in place.

French Bridging finance is  usually a highly flexible and adaptable form of finance that’s suitable for many different borrowers, but it’s important to understand what is and isn’t suitable for before proceeding with an application. Anyone considering taking out a bridging loan must ensure that they fully understand the terms and conditions associated with the loan, and should consult their lender or broker before proceeding.

How Does Bridging Finance Work for France Property?

A bridging loan in France combines the purchasing power of a mortgage with the flexibility and speed of a personal loan; borrowers are able to access large sums of money without waiting for weeks for funds to become available. Because of this flexibility, bridging loans may be used to secure an asset quickly, which is often a high priority in property development. In fact, many bridging lenders boast lending times of less than a week, with decisions in principle sometimes available on the day of application. Once the asset has been secured, a long-term financial solution (such as a mortgage) can then be put in place, and the bridging loan repaid.

This can be a powerful tool because it enables buyers to circumvent the tight restrictions and slow pace of mortgage lenders. For instance, a property developer might have the opportunity to purchase a building at a bargain price – it’s currently in need of repairs, but they have the skills and expertise to refurbish it. Unfortunately, they don’t have the cash to purchase the property outright and must borrow to cover the cost. Because the property is unmortgageable (as it’s uninhabitable), the deal is sunk: however, the developer is able to take out a bridging loan instead. This will cover the cost of purchasing the property and of restoring it to a mortgage-able condition; once this is complete, a mortgage will be arranged and the bridging loan repaid. In this way, bridging finance can enable developers to take advantage of opportunities they otherwise wouldn’t be able to, which keeps the real estate sector fluid and flexible.

France Bridging Finance Main Features:

  • Typically have a higher interest rate from 1% per month.
  • Arrangement fees from 1.5%
  • Ideally lending to companies Ltd Co’s, SPV,s BVI’s but can lend to individuals.
  • Lenders may require cross-collateralization and a lower LTV ratio.
  • Normally short-term, 3 to 12 months. But can go up to 36 months if needed.
  • Non standard bridging finance cases and vanilla bridging cases.
  • Commercial and Residential Bridging from EUR100,000 to EUR500m.

What Do Our Lenders Look At When Underwriting Bridging Finance Applications?

The Security

The security is the asset or real estate that the bridging loan is secured against, and what would then be repossessed if the loan was not paid back as agreed. Technically, any asset can be used as security, and they do consider assets that aren’t real estate. Typically, however, bridging finance transactions use a residential or commercial property as security.

The Borrower

The person borrowing the money is a key factor of any application. Whilst their income or assets may not be relevant to the application, the “quality” of the borrower in terms of standing, background or experience goes a long way in determining whether a loan is granted.

The Purpose

The reason a bridging loan is required is a vital piece of information. Lenders will also look at the circumstances that make bridging finance a necessity, how speculative the transaction is or how many moving parts there are.

The Bridging Finance Exit

How the loan will be paid back. One of the most important parts of any bridging loan application is how the borrower plans to exit the loan, how certain or advanced this exit is, and what can go wrong. These elements are of central importance to the deal.

How Do Our Lenders Underwrite Bridging Finance Applications?

  1. First, they want to understand the scenario, the asset, the plan and the exit. This information is presented to them is relevant as long as it’s clear, organised and transparent.
  2. With this information in hand, they will work through the transaction with their credit team, do their research and background checks. Of course, they will do this thoroughly, but and will complete it as fast as possible.
  3. If they don’t think they can help, they will clearly tell you and then explain why.
  4. If they think we can help, they will offer non-binding but credit backed heads of terms. This will clearly explain the lending rate, loan to value, term, fees and other pertinent information. This will be valid for a short period of time.
  5. If the terms are acceptable, they will instruct and engage lawyers, valuers and other required parties to start their process.
  6. They will then also ask the borrower for supporting documentation and other paperwork vital to the application – this will be the minimum required, and they will not request anything superfluous.
  7. Once everything is returned and complete and the file is ready, they will pass it back through credit. If everything stacks up, they will offer the final, binding mortgage offer.
  8. If there are problems at this stage, they will work with you to find solutions if there are any – this may then result in a change in lending terms – if that’s the case, they will be clear with their reasoning and then work to move forward.

Our lenders will give borrowers as much confidence in our commitment to funding your plan through feedback, communication, and progress throughout this process.

What Is An Exit Strategy For Bridging Finance Cases?

An “exit strategy” is one of the most important parts of any bridging loan application. It refers to how the bridging loan will eventually be repaid.

Typical Repayment Options For Bridging Deals are: 

  • Sale of the property
  • Refinance of the loan
  • Sale of another property
  • Sale of a business
  • Sale of stocks
  • Inheritance/divorce or other life events
  • Other value extraction

Lenders will look closely at the exit strategy and stress test the plan. They have years of experience and unique insights into the property market, financing and borrowers, and go beyond normal conventions to assist clients in this area.

All lenders ask is that borrowers are clear and transparent and work with them to develop a viable plan. They are comfortable with speculative, unusual and complex situations. The more they understand, the better the outcome and transparency are key to getting the deal completed.

Lending money is easy. Getting it back is hard



Repaying a Bridging Loan in France

The flexibility and speed of a France bridging lender loan comes at a higher price than a mortgage, and interest is typically charged monthly rather than annually. This means that a bridging loan can be extremely expensive if not handled properly, as a 1.5% monthly interest fee adds up to a whopping 18% over the course of 12 months. Because of this, most bridging loans are kept as short as possible, and borrowers make sure they have a secure exit strategy in place.

A bridging lender in France will usually take pains to stress-test their borrower’s exit strategies, ensuring that when the time comes they will be able to repay the loan. In many cases, an exit strategy consists of the sale of the property, but most lenders will work with their clients to establish a viable repayment strategy.

Because bridging loans are secured against the borrower’s assets, the bridging lender will be able to reclaim any lost payments through the sale of the debtor’s security. Depending on the lender, this can be a first or second charge against the property itself, on the borrower’s own house, or on other assets (some commercial lenders will allow businesses to use assets like machinery and vehicles as security.

Types of Bridging Finance In France

1st Charge Bridging Loans

Bridging loans are a flexible form of finance that can be put to many uses; in this article we discuss the application of 1st charge bridging loans and finance

2nd Charge Bridging Loans

Bridging loans are a highly flexible form of finance, and we discuss why the ability to secure a 2nd charge on a single asset can be invaluable for borrowers

3rd Charge Bridging Loans

Bridging loans are a highly flexible form of finance, and we discuss why the ability to secure a 3rd charge on a single asset can be invaluable for borrowers

Auction Finance Bridging

Bridging loans for auction finance are a crucial link for purchasing property at auction, enabling developers and landlords to complete purchases quickly

Bridge to Let Bridging Finance

Buy to let properties are a great way of securing a productive investment, and landlords can use bridging loans as a fast and flexible way to purchase property

Buy to Let Bridging Finance

Buy to let investment is still one of the most popular ways to acquire real estate, and bridging loans are a vital tool for securing rental properties

Buying Before Selling Bridge

Buying before selling enables homeowners to break free of their property chains, and can often be achieved with the help of bridging finance.

Chain Break Bridge Finance

Breaking free of the property chain is crucial for many buyers, and bridging finance is often an ideal way to jump-start a property purchase

Discounted Purchase Bridge Finance

Bridging loans can be used to enable the purchase of property at a discounted price, where speed and flexibility makes them an ideal choice for property developers

Divorce Bridging Finance

Though it is never pretty, divorce is sometimes simply a fact of life. Bridging finance helps divorces resolve quickly and smoothly with the minimum disruption.

Fast Property Purchase Bridging

Completing a property purchase quickly can be highly valuable to many buyers, and bridging loans can offer the ideal solution for a quick purchase

Freehold & Lease Extension Bridging

Purchasing a lease extension or freehold to maintain property’s value is often the right choice for owners, and bridging loans enable fast leasehold extensions

High Value Property Bridging

High value property is a highly competitive sector of the UK real estate market, and requires specialist bridging lenders to provide bespoke financial solutions

Inheritance Tax Bridge

The UK Inheritance Tax is a significant bill for an estate’s executors. Meeting this quickly and easily is a task that bridging finance is ideally suited for.

Non-Status Bridging Loans

Non-status bridging loans enable investors to develop their portfolios without the restrictions of affordability assessments, and are a powerful form of lending

Personal Bridging Loans

Personal bridging loans are one of the most flexible financial products there are, and bridging lenders are able to meet the varying needs of their clients.

Probate Finance Bridge

Bridging loans are hugely flexible and may be put to a variety of uses; one common use is to help resolve probate issues loans while waiting for inheritance UK.

Property Downsizing Bridge

Downsizing can be a smart move for many property owners, and a stable form of finance such as a bridging loan is needed to provide flexibility and security

Quick Purchase Bridging Finance

Moving quickly can often be make-or-break for a deal, and it’s important that professionals are able to access fast-moving sources of finance.

Regulated Bridging

Regulated bridging loans are loans secured by first charges or second charges against a property which is currently, or will be, occupied by the property owner.

Unregulated Bridging

Learn the benefits of unregulated bridging loans, how much you could borrow and how much it could cost.

Bridging Finance FAQ’s

How fast can a bridging loan be arranged? 

In our experience, it’s not how quickly a loan can be completed, which is important. Instead, the most important factor in a bridging loan is usually how quickly the borrower is confident that the funding will be available.

Our lenders are fast. They are fast to underwrite, decide to lend, make offers and complete transactions if that’s required.

Which types of bridging finance do we offer?

Lenders don’t have a type, and they dont have defined sectors they specialise in. Our lenders are not a mainstream bridging finance lenders, and they are not here for straightforward transactions – there are other fantastic lenders for that.

Our lenders offer solutions for complex, high-value or international bridging finance requirements where the solution needs thought, ideas and solutions.

What are the important features of a bridging loan? 

 Who is the borrower?  

 What is the security?  

 What is the reason for the loan?  

 How will the loan be repaid?  

 How long will the loan be required? 

Are the bridging fees clear and transparent? 

Yes. Bridging lenders fees are detailed clearly on bridging offer letters and are set out in % and £/EUR terms. In addition, they give you an estimate of professional fees that will also be incurred during the process, such as legal or valuation fees. They do not want you to have any surprises through the process.

Will you need legal representation for bridging finance?

Yes, you select a lawyer to act on your behalf and to provide Independent Legal Advice. Lenders write that this is a condition of any loan to ensure that your interests are protected.

Learn more here about International Bridging Finance


    Platinum Global Bridging Finance is a distinguished high-net-worth finance broker. We specialize in providing tailored financial solutions, including Property Bridging Finance, Development Finance, Single Stock Loans, Margin Stock Loan and Commercial Property Finance tailored to meet the diverse needs of our clientele seeking robust financial lending solutions.

    Bridging Finance France – Property Bridging Finance October 5, 2020