Bridging Loan To Avoid Bankruptcy
Those affected by bankruptcy often have questions regarding bankruptcy loans, bankruptcy mortgage applications, and general bankruptcy finance, both immediate and long-term.
Loans for people after bankruptcy do exist but are not necessarily the same as those for borrowers with a clean credit history.
If your application for bankruptcy is successful, all debt repayments are frozen, and monthly repayments are halted (unless you are declared able to continue paying a reduced amount). This may include your car, your home, and your general possessions, though there are restrictions to ensure those affected are not rendered homeless or unemployed.
Bankruptcy mortgage loans, personal loans with bankruptcy, and various types of secured loans can still be granted where extreme credit issues apply. Short-term financial solutions like bridging loans are also available, which can be useful for clearing debts, meeting urgent outgoings, or funding major purchases (like cars or homes). It simply means you need to target the appropriate lenders with your applications.
Personal loans issued on the basis of strong credit are more difficult to access, though they may not be entirely out of the question.
How to get a loan or mortgage after bankruptcy
The key to getting any kind of loan or mortgage after bankruptcy lies in seeking qualified expert support at the earliest possible stage. Rather than taking your business directly to any specific lender, it is far better to consult with an independent broker.
In doing so, you will access the impartial and objective advice you need to choose an appropriate way forward. In addition, your broker will be able to compare bankruptcy mortgage loans (and other types of loans) on your behalf with an extensive panel of specialist lenders.
Even if you have been turned down repeatedly elsewhere, there is every possibility that a reputable broker will help you find a competitive loan at a price you can afford. Importantly, exploring the available options with the help of a qualified broker can also protect your credit file from further damage, should any of your applications be unsuccessful.
If you are looking for help applying for a loan after bankruptcy or are simply interested in the available options, we are standing by to take your call. Contact a member of the team at UK Bridging Loans anytime for an obligation-free initial consultation.
Uk’s Best bridging loan rates from 0.55%
How it works
Get in touch
Clients approach UK Bridging Loans either directly or via introducers. Basic questions by way of a “fact-finding” process are used by UK Bridging Loans to determine if the lending requirements are a possibility.
Fast approval
An immediate yes or no answer is given, and if suitable, a quotation is formulated and forwarded to the client, usually by email.
Formal offer
A formal offer is produced for any client wishing to proceed and forwarded for signature, again, usually by email.
Representative visit
Each client is visited at the security address for the signature of the remaining loan paperwork, including a CH1 land registry charging order. We will also collect any additional pre-requested documentation.
Dedicated underwriting
The signed documentation was immediately sent to our underwriters. Our model is based on very quick completions, as each deal is funded using all of our own money. On rare occasions, we may request additional information.
Payment of funds
Average completion from initial acceptance to pay-out is usually just a few days. We rarely require valuations or additional legal representation. The land registry charge will be removed once the bridging loan is repaid.
Who can use bridging finance?
Age
The applicant could be too old to obtain a standard high-street mortgage, as most mortgage lenders now prevent borrowing beyond what is deemed “normal retirement age”.
Property conditions
The property may be in a condition where it is not suitable for mortgage financing, and as such, a bridging loan could be used to complete the purchase and any required work prior to refinancing.
Credit
The applicant may have had some adverse credit, however minor, which was previously acceptable to lenders but now no longer fits the high street lending criteria.
Income
The applicant may have difficulty proving the income requirements needed for more regular financing. This may be due to poor self-employment records, a break from work, a reduction in self-employed workloads, or overtime.
USP’s
Superfast completion, often within days
Quick auction finance
2nd charge behind the bridging lender
Pure equity-based lending
Loans from £25,500
Land, with or without planning
3rd charge (consent is not always required)
2nd charge behind the equity release lender
Residential and commercial
A free legal option
2nd charge (consent is not always required)
Adverse credit is considered
Up to age 85
Valuations are not always required
No monthly payments
Frequently asked questions
Is there a way to avoid bankruptcy?
Yes, there are several ways to avoid bankruptcy, including:
- Negotiating with creditors: This can involve trying to lower your interest rates, extend your repayment terms, or consolidate your debt into a single loan with a lower interest rate.
- Seeking credit counselling: A credit counsellor can help you create a budget, develop a debt management plan, and negotiate with your creditors.
- Declaring forbearance: Forbearance is a temporary pause in your loan payments. This can give you some breathing room while you work to get your finances in order.
- Seeking bankruptcy protection: Bankruptcy is a legal process that allows you to reorganise or eliminate your debt. It should be considered a last resort, but it can be a helpful option if you are unable to pay your debts.
Does a bankruptcy ruin your credit?
Yes, bankruptcy can have a significant negative impact on your credit score. It will remain on your credit report for 7–10 years, and it can make it difficult to obtain loans, rent an apartment, or get a job. However, it is important to remember that bankruptcy is not the end of the world. You can rebuild your credit over time by making on-time payments on your debts, maintaining a low credit utilisation ratio, and avoiding additional debt.
How long does it take to rebuild your credit after bankruptcy?
It can take anywhere from 2 to 7 years to rebuild your credit after bankruptcy. The exact amount of time will depend on your credit history, your ability to make on-time payments, and your overall financial management.
Is it true that after 7 years, your credit is clear?
No, it is not true that your credit is completely clear after 7 years. Bankruptcy will still show up on your credit report for 10 years, but it will no longer be considered a “derogatory” mark. This means that it will have a less significant impact on your credit score.
Can you remove bankruptcy from your credit report early?
There are a few ways to remove bankruptcy from your credit report early:
- Obtain a bankruptcy discharge: This is the legal process of having your debts discharged or forgiven. Once your debts are discharged, bankruptcy will no longer be considered a “valid” mark on your credit report.
- File a motion to reopen your bankruptcy case. This is a rare and complex process, and it is typically only successful if there was a mistake in your original bankruptcy filing.
- Challenge the bankruptcy information on your credit report: If the bankruptcy information on your credit report is inaccurate or incomplete, you can dispute it with the credit bureaus.
How often can you file bankruptcy?
There are limits on how often you can file for bankruptcy. In most cases, you must wait 8 years after filing for bankruptcy before you can file for Chapter 7 bankruptcy again. You must also wait 2 years after you filed for Chapter 7 bankruptcy before you can file for Chapter 13 bankruptcy again.
Bridging loan uses
Opening Hours
Mon-Thurs: 9am-8.30pm
Fri: 9am-5pm
Sat: 10am-5pm
Sun: 11am-5pm
Open 7 Days a Week
