Understanding business bridging loans
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Pages in this SectionWhat is a business bridging loan?
A business bridging loan is short-term financing used to bridge the gap between immediate funding needs and securing long-term finance. These loans are commonly used for property purchases, business expansion, or cash flow management. They typically have higher interest rates due to their short-term nature and faster approval process.
Business bridging loans can help businesses address:
- Property acquisitions or expansions
- Cash flow challenges
- Development projects
- Time-sensitive investment opportunities
How does a business bridging loan work?
A business bridging loan allows you to secure immediate funding by using an asset—such as commercial property—as collateral.
- Apply: Submit your business’s financial requirements and asset details.
- Loan offer: We’ll assess the asset’s value and offer a tailored short-term loan.
- Funds released: Once approved, funds are typically released within days.
- Repay: The loan is repaid in full when your longer-term funding or revenue becomes available.
This short-term solution is ideal for businesses that require fast and flexible funding with a clear repayment plan.
When to use a business bridging loan
Business bridging loans are a versatile financing option, commonly used for:
1. Purchasing commercial property
Bridge the gap between securing a new property and the completion of a sale or refinancing.
2. Property development projects
Finance construction or refurbishment projects while waiting for sales proceeds or development finance.
3. Resolving cash flow issues
Bridge cash flow gaps caused by delayed payments or unexpected expenses.
4. Auction property purchases
Complete property purchases within tight deadlines, such as 28-day auction terms.
5. Seizing business opportunities
Invest in time-sensitive opportunities, such as discounted stock or expansion projects, without financial delays.
Types of business bridging loans
Commercial bridging loans
Designed for businesses purchasing or refinancing commercial property, these loans provide fast access to funds to prevent delays in critical transactions.
Auction finance
Specially designed to meet tight deadlines for auction property purchases, ensuring businesses don’t miss out.
Development finance bridging loan
For developers managing construction or refurbishment projects, bridging loans can provide short-term funding until longer-term solutions are secured.
Short-term working capital loans
Address operational cash flow challenges by bridging the gap until expected revenue or investment arrives.
Have you thought about invoice finance as a quick financing solution for your business?
Invoice finance allows you to release cash quickly from your unpaid invoices.
As your lender, we can release up to 90% of your invoices within 24 hours. On payment of the invoice from your customers, we will then release the final amount minus any fees and charges. There are different types of invoice financing options available such as factoring (mainly invoice factoring and debt factoring) and invoice discounting to businesses depending on the situation and the level of control they require in collecting unpaid invoices.
We are an invoice financing company who offer a solution whereby payments are collected on your behalf managed by our team of expert credit controllers so you can focus on running your business. Our confidential invoice discounting solution is offered to businesses who want to maintain their own credit control processes, therefore this remains strictly confidential so your customers are unaware of our involvement.
More business loan resources
The benefits of fast business financing companies such as Novuna Business Cash Flow
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