Bridging finance might be just the solution when you’re looking to secure a property quickly or need short-term finance to bridge a gap. However, one of the key concerns most people have is, “How long does bridging loan conveyancing take?”. At Triangle Legal Services, our bridging loan solicitors understand the urgency and tight timelines involved with bridging loans, and our goal is to guide you through the process as quickly and clearly as possible.
What is Bridging Loan Conveyancing?
A bridging loan is a short-term secured loan designed to help “bridge the gap” between the purchase of a new property and the sale of an existing one. It can also provide fast funds when you need to complete a property purchase quickly. Bridging loans are typically used for time-sensitive situations, like buying a property at auction, funding a property chain break, or financing property renovations before a mortgage is in place.
Conveyancing is an important step when taking out a bridging loan. This is the legal process of transferring property ownership and making certain everything is in order before the loan is approved. At Triangle Legal Services, our role is to carry out this legal process quickly and accurately. We’ll check the title deeds, make sure the lender’s requirements are met, and confirm that all necessary paperwork is completed.
Legal Factors that Will Affect Your Bridging Loan Application
Several legal factors can affect how quickly you can secure your funds when applying for a bridging loan.
The Security for the Loan
The type of property you use as security for your bridging loan – whether residential, commercial, mixed-use, or land – will affect how long it takes. The more complex the property type, the longer the conveyancing process may take.
Residential properties are usually simpler, with straightforward checks on ownership and restrictions. However, commercial properties often require more in-depth checks, such as business leases, planning permissions, and environmental concerns. If the security is a piece of land or development property, additional due diligence is required around development potential and legal restrictions.
Due Diligence Requirements
One of the main parts of the conveyancing process for a bridging loan is making sure all the legal checks are in order. This is known as “due diligence.” It involves a series of steps to confirm that the property you’re using as security for the loan is legally sound and free of issues that could affect the loan or your ability to repay it.
The simpler your situation, the quicker the due diligence process will be. For example, if you’re the sole owner of the property and there are no outstanding legal issues.
However, if the title is complex, there are joint owners, or the property has any legal issues attached to it, the process can take longer while these are ironed out.
Open Bridging Loans
An open bridging loan is a loan with no set repayment date. It’s usually taken out when you know you’ll pay it back soon, but you’re not exactly sure when that will be. For example, you might be waiting to sell a property but aren’t certain how long that will take. While open bridging loans offer flexibility, they can sometimes take longer to arrange because bridging lenders may need more assurance that the loan will be repaid eventually.
Closed Bridging Loans
A closed bridging loan has a fixed repayment date. This type of loan is often used when there is a clear exit strategy, like the set date of a property sale or the approval of a longer-term mortgage. Because the bridging loan lender has more certainty about when you will repay your loan, the process can be quicker.
Lender’s Requirements
Each lender has their own legal checks and requirements before they approve a bridging loan, which can affect how long the process takes. Some lenders have more detailed procedures, asking for a lot of paperwork and strict checks on both you and the property. They might look closely at your credit history, financial situation, and any existing debts.
They may also need an independent valuation of the property, surveys, and proof that any legal issues, like title disputes or restrictions, have been sorted. While some lenders are flexible and quick, others have stricter rules that will take more time. Knowing what your lender needs in advance will help make the process faster.
Typical Timeline for Getting a Bridging Loan with Legal Support
The timeline varies depending on the circumstances of the loan and the properties involved, but it generally follows a few important stages. Here’s a rough idea of what you can expect from start to finish:
Loan Application & Approval (24-48 hours)
Once you apply for a bridging loan, many lenders will give you an initial decision within 24 to 48 hours. They’ll do a quick assessment of your situation and the property you’re using as security.
Legal Instructions & Checks (1-2 weeks)
After approval, your conveyancers or solicitor will start the legal work. They will check the property title and ownership documents and carry out any required conveyancing searches (like planning, environmental, or land registry checks). Your lender will also need to confirm the property’s value and make sure it meets their criteria. During this time, you may also need to provide additional documents or information.
Loan Agreement & Completion (3-7 days)
Once all legal checks are complete and the lender is satisfied, your solicitor will prepare the loan agreement for you to sign. After signing, the funds are released, and you can expect to have the money in your account within a few days.
Common Legal Delays in the Bridging Loan Process
Being aware of common issues that cause legal delays can help you prepare in advance and avoid any unnecessary delays.
Title Issues
One of the most frequent causes of delay is problems with the title deeds. This could include disputes over ownership, boundaries that aren’t clearly defined, or existing charges (such as mortgages or other loans) that need to be settled. Any issues need to be resolved before the loan can proceed, which can add time to the process.
Valuation and Survey Delays
Lenders usually require a valuation to confirm the property’s worth and, in some cases, an in-depth survey to assess its condition. If the valuation comes back lower than expected, this can slow things down. Sometimes, additional surveys are required if the lender has concerns about the property, which can add further delays.
Lender-Specific Requirements
Different lenders have different requirements, and some may require additional checks or documents. For example, some lenders might need proof of how you plan to repay the loan, or they may have strict criteria for certain types of properties, like a shop with a flat above or timber-framed houses. This will add time to the process as you gather and submit all the required information.
Third-Party Delays
The bridging loan process often involves several parties, including solicitors, surveyors, and sometimes other property professionals. If one party is slow to respond or requires more information, this will hold up the process. Additionally, if the seller or other party involved in the property transaction has their own solicitor or is slow to provide necessary documents, it can cause delays.
Planning Permissions or Restrictions
If the property you’re using as security has any planning permissions, restrictive covenants, or specific usage restrictions, these will need to be checked and verified, which can take time to resolve. For example, if you’re using a commercial property, the lender will want to make sure it can legally be used for its intended purpose.
Need a Bridging Loan Solicitor? Our Property Solicitors Can Help.
We know that bridging loans often need to be arranged quickly, so our experienced solicitors work efficiently to make the process as straightforward as possible. With our extensive knowledge of bridging finance, we know exactly what lenders require and can anticipate and resolve issues before they cause delays. Whether your property is residential, commercial, or mixed-use, we provide clear, practical advice to guide you through every stage, helping you secure your bridging loan quickly and stress-free.
If you need help with a bridging loan, please contact us today for a conveyancing quote.
FAQS
Is it quicker to get a closed bridging loan or an open bridging loan?
A closed bridging loan tends to be quicker because it comes with a set repayment date and a clear exit strategy, such as the sale of a property or an upcoming mortgage approval. Lenders usually see closed loans as less risky, so they often require fewer checks. An open bridging loan doesn’t have a fixed end date, which can mean more scrutiny from lenders and, as a result, a slightly longer process.
How long does it take to get bridging finance for a commercial property?
The timeline can vary, but securing a bridging loan for a commercial property typically takes longer than for a residential property. This is because commercial properties often require more detailed checks, such as reviewing commercial leases, planning permissions, and making sure that the property can be used for its intended purpose.
What can I prepare when taking out bridging loans to make the transaction faster?
Before applying, make sure you have all necessary documents ready, including proof of ownership, property details, financial statements, and any information on the property’s title or existing charges. It’s also helpful to have a clear plan for how you’ll repay the loan (the “exit strategy”), as lenders will want to see this upfront. Finally, working with experienced bridging loan solicitors can help you navigate the legal side quickly and efficiently.