In particular we focus on getting the loan structure right the first time, choosing which lenders to use in the right order (yes this is important) and finally getting our clients the best deal possible.
Bridging Loan
A bridging loan allows a property owner to buy a property before selling an existing property, essentially it is a short-term loan like a line of credit the ‘bridges the gap’ from one property to the next.
If you’re in a situation where you have found your next dream house, but haven’t sold the one you’re in. You’ll need finance to meet the gap between receiving funds from the sale of your existing home and buying your new property. It’s essentially giving you a line of credit to cover the ‘bridge’ between purchasing the new property and receiving settlement funds on the old.
Apart from purchasing an existing property they also allow you to build a new property within 12 months.
So, what are some benefits of using a bridging loan other than finding your dream home before you sell your other one? It means you don’t have to live somewhere else temporarily, you get to move from one house the next and it gives you time to make your current property look as perfect as it can for sale.
The amount of equity needed for a bridging loan can depend on specific lenders and borrowers financial situation. Majority of lenders that deal with these types of loans will say you need at least 20% equity for a bridging loan and this is calculated on the peak debt, which means both properties existing and new loan will be taken into consideration.
Learn MoreBridging loans are possible if you have at least 20% equity. They are used to ‘bridge’ the gap from selling your current home to purchasing your new one.
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