When Should You Choose a Bridging Loan Over a Development Loan?

A development loan has a set time frame but allows you to draw money as you need it, which can be very helpful in getting your project off to a strong start. However, if your cash flow gets tight and you’re not able to meet all of your payments, you may lose some of your equity. 

This is why many developers choose to get a bridging loan instead—you pay interest only on what you borrow, meaning that your equity stays intact. There are downsides to both types of loans; discuss them with your lender before deciding which one works best for you.

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