International Bridging Finance - Overseas Bridging Finance

Bridging finance originated in the UK, and it is a mainstream and popular financing solution in the country. Where bridging loans originated as a solution to buy a new property before you sold your old one, today, it's used much more broadly and in lots of different scenarios. As a result, people in the UK view such funding as a long-term and flexible means to finance a property investment.

Bridging finance in the UK is also regularly used to fund renovation and redevelopment work, allowing for the refinancing of property assets after a potentially significant uplift in value.

In Europe and other countries, however, bridging finance largely remains a straightforward financing mechanism that's used when an individual wants to buy a new property but is still waiting on the settlement of a house sale.

Despite this, bridging finance is available internationally, albeit with some restrictions or elements to navigate. Enness will be able to help you if:

• You are based in the UK and want to use your international property portfolio as collateral for a bridging loan
• If you are a non-UK resident and have international properties that you would like to secure bridging finance against, using UK-based or international bridging finance lenders
• If you are not a resident of the UK but have one or more UK properties you would like to use as collateral for a bridging loan

Restrictions On International Bridging Finance

In many ways, the UK is more liberal and outward thinking than any other financial market in the world. If you require finance and have real estate that you can use as collateral, there is not much that is not up for negotiation.

Other parts of the world - Europe in particular - is slightly more reserved. Differences can look subtle but scratch below the surface, and you'll often find significant anomalies or characteristics that influence international bridging finance.

For example:

• German lenders cannot charge more than twice the standard interest rate on loans
• Spanish homes are often passed from generation to generation within a family. As a result, they are viewed as a possession as opposed to an investment
• Some foreign countries will not accept international mortgage applications based on sterling income streams

It'll come as no surprise that these subtle restrictions in some European markets have reduced overseas competition in the international bridging finance sector. It is also fair to say that the UK international bridging finance sector is one of the most advantageous in the world. Mainstream banks and specialist mortgage companies in the UK are more than happy to accept international property as collateral for short-term bridging loans. They also have an international outlook and are happy to consider clients who live abroad or have properties around the globe.

Structuring International Bridging Finance

In theory, the structure of a bridging finance arrangement is relatively straightforward. Funds are released at a predetermined interest rate on a short-term basis. In this instance, they are backed by international property assets, which more than cover the lenders' financial exposure. The short-term nature of such transactions means there is relatively little exposure to currency movements. However, currency movements are still a risk that you shouldn't overlook.

There are ways and means of mitigating currency risk, especially for short-term financing, which will help you obtain a more competitive interest rate. Enness has significant experience and contacts in this area and will help you put a plan together to make sure you are exposed to a minimum of risk.

As well as considering currency exposure, Enness looks at the whole picture when it comes to international bridging finance. The team will put forward the solutions that meet all your financing needs and propose a plan of action that will help protect you from unnecessary risk. You can expect bespoke service, and a holistic approach will consider and plan for all aspects of your financial well-being, no matter how complex your circumstances or your transaction.

Different Jurisdictions, Different Laws

It's easy to fall into the trap of assuming that foreign laws will be similar to those in the country where you live or your homeland. If only things were so simple.

Laws, regulations and rules vary from country to country and can change significantly, even between countries with similar legal systems. When it comes to international bridging finance, work alongside a partner with a track record of negotiating international bridging deals. Understanding the subtle differences between jurisdictions and their respective rules and regulations will make (or break) an international bridging deal.

Enness offers every client a bespoke experience that's tailored from start to finish around your needs. Your broker will ensure you're offered an international bridging finance deal that protects your interests and encourages competition from lenders, creating a favourable outcome for you.

Enness has a growing number of overseas offices, and the company has recently extended its international footprint and influence. The team has access to localised legal advice in countries across Europe and around the world. As a result of Enness' experience and contacts, the team has often overcome many challenges on behalf of clients and have succeeded in completing deals where others have failed.

If you are looking to use your international property portfolio as collateral for international bridging finance, Enness can help you. Get in touch to have a no-obligation chat about your needs.