When one replaces an existing loan with another one, this act of his generally called remortgage. This is basically done in order to be able to pay off an existing loan with a new one. This implies an effort to increase your debt component in order to lower down another debt component.  A bridging loan on the other hand is a totally different and a short term concept. The recent times in the United Kingdom, especially the current year 2013 has seen a growing trend for strict rules and guidelines to be followed regarding Remortgage loans. There are reported cases where couples are being denied a remortgaged loan on account of their building when they had been able to secure a loan on the mortgage of the same building merely four years earlier.

Bridge Loans and Secured Loans To Fill In For The Lapse In Remortgage Loans

This has led to a tightening trap of mortgage loans in the UK. People who don’t find themselves in a decent enough position to back loans have to resort to remortgage loans in order to be able to pay off their older debts which are somehow not possible in the current scenario. The same can also be viewed as a precaution to the economic  crunch that came to be seen in the US on account of large scale granting of mortgaged loan on account of property that had been hypothecated with the banks.

The basic Reasons behind Rejection of Remortgage Loans in the UK in 2013 stand as follows:

  • No sufficient Proof to document the individual’s income

  • No strong and dependable compensating factors

  • Loan officer being inexperienced

  • Improper valuation of the property concerned

  • Stringent controls and new rules

Bridging Loans and Secured Loans are Making Headway

The above condition has only highlighted the importance and the availability of other sources of finance in the form of bridging loans and secured loans. A bridging loan is a short term loan availed on a short term basis till the time apt finances become available. People on the lookout for remortgaged loans or the ones who are in constant negotiations to settle the terms of one generally prefer Bridge loan as one of the best options to fill in the intervening gap. This means once that the person concerned has obtained a strong foothold in the form of a mortgaged loan he will be in a better position to pay off the intervening bridge loan that had been taken up by him.

Another alternative to a mortgage loan might be a secured loan which means that the individual can take to pledging any sort of property like a car and take up a loan on the security of the same. This is contrast to the bridge loan is not a type of short terms finance, rather this is taken by people looking forward towards long term financing. The mechanics of this loan are quite similar to the Bridge loan in the sense that secured loans secure the creditors or providers of the loan. In case of any defaults in making payments for the same, the creditor can use the hypothecated property to recover his loss. Thus as more and more Remortgage Loans get rejected and delayed in the UK, bridge loans and Secured loans are making  a headway to becoming the most popular credit choices.