Alternative Residential Lending and Bridging Finance

Since the global credit crisis of 2008 and the subsequent property market downturn worldwide, many changes have been made to the rules and regulations regarding how banks now lend money for property purchases. And Spain is no exception to the rule, as it is more difficult to secure a Spanish mortgage in general terms, especially if you’re unable to tick all of the boxes the Spanish banks require. However there are different avenues to explore, and with the help of Fluent Finance Abroad we can introduce you to Alternative Residential Lending.

With the changes in mortgage authorisations and different strategies applied by the banks, you may find yourself deemed as a slightly higher lending risk by the underwriters, meaning that you’re unable to secure a mortgage with a traditional high street Spanish Bank.

If, however, you don’t comply, we at Fluent Finance Abroad can help you overcome these potential hurdles with our Alternative Residential Lending options, as well as a bridging loan in the interim, should this be required.

We totally understand that lending needs to be looked at on each applicant´s merits, and we’re geared to the requirements and circumstances of each individual client. With this in mind, we’ve been busy building mortgage alternatives in Spain which can solve any lending opportunities that the banks are unable or unwilling to consider.

We have a number of secondary market financial entities registered as lenders with the Bank of Spain that have the capacity to not only lend, but are flexible enough to consider each application on its own merit, enabling you to obtain the finance that you require.

A bridging loan is a short-term loan that landlords, homeowners and property investors use when purchasing a property while they’re waiting for funds to become available.

For example, homeowners can purchase a new property whilst they wait for their current home to sell – providing extra time and, often, peace of mind in the meantime.

There are two different bridging loans that you may encounter, including:

• Open bridging loans

An open bridging loan simply means that there is no fixed repayment date, so lenders will be able to repay their loan whenever funds become available. However, it’s important to note that lenders usually expect you to clear your debt within a year, but borrowing terms will differ depending on the company you choose.

• Closed bridging loans

Closed bridging loans have fixed repayment dates, so are best suited to borrowers who have an idea of when they’ll have access to funds. Generally, closed bridging loans are more affordable than open alternatives, given that there’s less flexibility around repayment dates and lower interest rates available.

Lenders offer bridging loans from anywhere between 5,000€ to 25M€ or more, but the amount you’ll be able to borrow depends on your current financial situation and credit history.