Do these bridging loan rates seem excessive?

Brock_and_Roll wrote: »

Its £3k because in a nutshell the lender only has 6 months to earn any money to recoup (the significant) costs and earn a profit as opposed to 25 years.

If it makes the OP feel any better the last time I had an open bridge in addition to paying a £3,500 fee, I ended up with two bridging loans from GE Capital at 7.5% - squeezed the very life out of me.

IMHO bridging loans are very risky and highly stressful - despite the best laid plans, something can always go wrong and you can be left up to your neck in it.

So I would not recommend unless in exceptional circumstances and if you have good nerves!

Thanks for your post. So the bit I notice is you also had to pay £3000 arrangement fee! Well "Golly Gosh and Jumping Jehoshaphat"!!!! I thought solicitors were the highwaymen of the professional services industry (Excluding those that post and support the MSE community of course)well it seems they've got some stiff competition.

Hi financegeek, yes the exact situation is that I own unencumbered assets ie property and am newly self employed meaning I have no income. This might be possible to get a buy to let mortgage on the property in question if it were habitable but as the house needs to have the refurbishment complete the only option is for bridging. I wince at the overall cost but I have to confess the house had unexpected additional building works that I didn't account for and essentially haven't got enough money to finish the house in a reasonable time frame

Once I borrow the bridging finance I can then get a buy to let mortgage on it when the house has been let, I'm going to go for at least an 18 month bridging loan so at least I'll have time to sort out a mortgage

CakeCrusader wrote: »

Solicitors have to be transparent with the fees, so you'll know exactly how much you've been charged for letters/phone calls etc right from the outset, they also have different payment terms, like a conditional fee arrangement or pay as you go. Given each solicitor is a professional who's spent 4 years at University at the cost of about 50k, followed by another 2 years of training, they aren't really "highwaymen" of the professional services industry, they are mostly just trying to repay their student loans.

Well said sir! Very well said!!