Online Bridging Loan quotes
KIS Finance provided the first online calculator to work out the cost of bridging loans. Many of us will be familiar with mortgage calculators, such as the one displayed on every property for sale listing on Rightmove, to help you work out how much your mortgage would cost each month depending on how much deposit you have, the interest rate and repayment term. This Bridging Calculator is used in a similar way and is to provide an estimate for all of the costs including all fees.
Bridging loan are a short term finance facility, the interest on the amount borrowed can be paid monthly or more commonly the interest is ‘rolled up’. This means that nothing is paid during the time the loan is taken and the entire amount is paid at the end. The Bridging Calculator will show you both options – as it calculates how much the monthly interest cost will be and how much the total loan amount plus the rolled up interest is if you choose to defer repayments until the end of the term.
How does it work?
To obtain a quote, you need to input the following information into the relevant boxes: the loan amount required, term required (how long until you can repay the loan), monthly interest rate (default rate of 0.54%, however for better accuracy, you can refer to the Loan-To-Value (LTV) guide to help you find out what rate you could obtain), number of properties to be used as security and the value and mortgage balance for each property.
The lender facility fee varies between lenders, however for the purposes of the online quote a default figure is used, which you can change yourself.
After hitting the ‘Calculate’ button, you can then see the quote for all the costs associated with the loan. This includes the monthly interest charged, how much interest is charged if the loan is kept for the full term and the gross loan amount plus rolled up interest. The other costs involved are also quotes, which are the valuation fees (estimate generated by the number of properties that will need to be valued and how much you estimate they are worth), the lender’s admin fee, lender’s legal costs, telegraphic transfer fee and redemption admin fee. If there is a chance you may want to repay the loan early, you can see how much exit fee you may have to pay, although not all lenders charge an exit fee.