Here is why you would need bridging finance
Bridging finance can be used for a wide range of purposes that range from borrowing for a investment property purchase to raising finance for property development, or just needing to raise money for any other reason.
The common use for a bridging is to raise money for the purchase of a new property, until an existing property has been sold. The lender uses the property to be purchased as the first charge security and places second charge on the existing property. The loan is repaid with the sale of the existing property and a mortgage on the new one.
Investors also commonly bridge to raise money for buying Investment Property at auction, overcoming mortgage lender retentions and purchase of property in a refurbishment project.
Other situations where a borrower will want to raise money quickly include, the need to buy a property that is being offered at a discount or completing the sale on a property when a sale of an existing property falls through.