TYPES OF BRIDGING FINANCE
DEBT BRIDGE FINANCING
It is when a company borrows money to cover short-term expenses while waiting for a loan. Companies seeking bridge financing must be aware because interest rates can be so high.
EQUITY BRIDGE FINANCING
In Equity Bridging Finance, the company chooses to give the venture capital firm equity in exchange for several months to a year of financing
IPO BRIDGE FINANCING
The loan is often supplied by the investment bank that is underwriting the new issue, and it is paid off with the money earned from the IPO
FIRST CHARGE BRIDGING LOANS
It is when the property/asset being used as collateral has no other encumbrances; for eg, it may be fully owned by the borrower because the mortgage has been paid off
SECOND CHARGE BRIDGING LOANS
Second charge bridging loans are typically used by people who need money but have a mortgage on the property being used as collateral