Since bridging finance usually lasts for a relatively short period you may find that interest rate you are being asked to pay is slightly higher than a more conventional type of loan. Lenders make their profit by charging interest across life of loan. The shorter loan period less interest they earn. As a result many lenders will often boost rate by a 1/2 point or more. In general, length of loan, amount of risk that is present for lender, quality of your credit history and liquidity and value of your collateral all are used to help determine interest rate.

Your best bet for securing a bridge loan at most favourable rates and terms is to work with a qualified UK Commercial Mortgage Broker who understands ins and outs of bridge loans. That way you can get your application in front of as many lenders as possible and end up with several who are willing to compete for your business.

Commercial Lifeline are Commercial Mortgage and Bridging Finance specialists.

With competition from lenders heating up you'll find that many of them are dropping ERC clauses all together. If there is one present in your loan contract you may be able to negotiate it away with little effort. It's worth trying in any case and you can always apply somewhere else if your lender is not willing to negotiate.

In case of a variable interest rate commercial mortgage rate is based upon those issued by Bank of England. The lender will usually state that rate consists of published rate, which will likely vary up and down over life of loan, plus some pre-determined premium that remains same for life of loan. Be sure that you understand how frequently your rate will change and that you are comfortable with amount that lender is charging as a premium. As with any terms of your loan you can negotiate both of these factors.

A fixed rate commercial mortgage is a good choice when you feel that interest rates are headed up sharply and you want to lock in current rates. On other hand, if interest rates are in flux, and economic indicators point to a down trend, then a variable rate may be your best choice.

Keep this strategy in mind during lifetime of your commercial mortgage. If you are locked into a fixed rate, and interest rates have dropped significantly below what you are paying, you should consider applying for a remortgage and selecting a variable interest rate to take advantage of lower rates. On other hand, if you are in a variable, and all indicators are that interest rates will be skyrocketing soon, then look to move into a fixed rate so you can protect yourself against future increases.

Commercial Lifeline are Commercial Mortgage and Bridging Finance specialists.