Ever since the financial crises everyone has tightened their belts from the government, to banks, to homeowners and businesses. But the technology world is booming and there are only two reasons it isn’t even bigger today: Skilled employees and finance. Although we can’t help you find your employees, we can help you with the finance. If you’re business is looking to expand, maybe by moving premise or refurbishing or hiring more employees, and you need to funds to do so, then you should discuss a bridging loan and LTVs.
– What is a Bridging Loan?
Simply, a bridging loan is a way to get a quick influx of cash that you can use on whatever you want. The amount you get is based off whatever equity you already own, and the rate you pay it back is worked out with your lender. You can expect to pay it back in around six months, but you can negotiate a longer term pay plan. There are some early admin fees, but there are no punishments for paying back early and you are free to use it on whatever you want, whether its investing in an idea, a new office, or some extra staff.
-What’s an LTV: LTV Discussed
The LTV is the Loan to Value ration. Basically, if you own some equity and it’s valued at half a million and you take out a loan for a quarter of a million, then your LTV is fifty percent. The more you take out based on your equity, the higher your LTV. Obviously, lenders want to guard themselves against risk, so the lower the LTV is the better they feel, but you can easily obtain up to seventy five percent of the value, and more if you have a great credit history. You can also read more here on LTVs as well.
– Why Is This Important?
The LTV is important because you want to get the most amount of money into your account while the bank wants to have as little risk possible. If you’re looking for a quick injection of money then you can use a bridging loan with a low LTV with very little hassle. This can free your business up to do what needs to be done. However, if you’re looking for more, and your LTV is higher, then you might run into some more complex issues. At the end of the day, if you simply need a quick injection, this is a great way of doing it. Very little fees, very little risk, and very little hassle. You can expand your tech business today.