Bridging loans suffer from something of a bad reputation but can be very useful in the right circumstances, a mortgage industry body has claimed.

The Council of Mortgage Lenders (CML) said that bridging loans - to ''bridge'' the gap between buying one property and selling another - are good for situations where sale and purchase times are not in close proximity to one another.

Bridging loans are typically subject to high entry and exit fees and high rates of interest and so do not present a long-term solution to finance problems, explained a spokesperson for the organisation.

A CML spokesperson said that bridging loans are "the main and obvious route" to immediate money issues when moving from one property to another.

However, she added that "the particular image and reputation of this sector is extraordinarily variable and not always positive" and advised borrowers to have a "clear exit strategy".

The CML represents most of the mortgage lenders in the UK and releases frequent reports on the state of the British housing and mortgage market.

source:http://www.earth.co.uk