How to Use a Bridging Loan
A bridge loan is much like the name implies; it's a loan that forms a "bridge" between
two transactions. Some call this a "swing loan" such as helping you "swing the deal." Having to use a bridge loan isn't always
best move financially. However, if your real estate or investment scenario isn't going exactly
as planned, using a bridge loan can really help you out.
Step 1
What happens when you find the house of your dreams before you have sold your current home? This is when most bridge
loans are used. Working with your real estate professional and your mortgage broker you can
go ahead and sign the contract on that house that you really want, even though you haven't sold your current home. The contract
will be written as being "contingent" upon you being approved for a bridge loan. This will mean that you obtain financing
to purchase the new home by borrowing against the equity in the home you own and that is currently for sale. Depending on
the bridge loan lender, you are normally only allowed to borrow up to ninety percent of the equity in your current home. Bridge
loans have terms anywhere from two months to two or three years. Note that you will be making payments on the bridge loan
along with your current mortgage payment if you have a mortgage on that home.
Step 2
Retrieve a property or piece of real estate before it goes to foreclosure. This is another use for a bridge loan. Real
estate investors do this quite often. They watch for homes that are about to be foreclosed, obtain their financing through
a bridge loan and purchase the property before it is foreclosed. The bridge loan is paid off as soon as this property is sold.
In this case, the bridge loan is granted to the investor based on other property or assets they own.
Step 3
Develop a new real estate subdivision or business complex. This can be yet another use for a bridge loan. The developer
or investment group may purchase some acreage with plans for building development. A bridge loan will come into use to purchase
the acreage while the interim financing is still being worked out for the entire project.
step 4
Consider any points. Sometimes you can
pay points to get down the interest rate. Although this may be expensive, these are typically tax deductible over the life
of the bridge loan. Since the loan term is short, you can recover the money fairly quickly.
Step 5
Calculate
your bridge loan. The easiest way to calculate your bridge loan payment is to use an online calculator such as the one available
at 1st bridge.com. When you enter in your loan amount, interest rate, term and points, it provides your monthly payment in
seconds.
A sincere effort is made at Finance Services to indulge in fast decision on loan approval so that
the funds can be availed by you at the earliest for usage. Our loan facility can assist you in navigating through the various
options available to you, and thereby help in choosing an apt deal. we comprises of a professional and experienced experts
who can extend guidance on matters pertaining to Bridge loan . For your convenience, a glossary of financial terms
has also been provided.
Enjoy the ease and comfort of getting access to loans services at Our Finance services by means
of an online application process or call , sms us. Get freedom from financial mess by availing our services right away!
Contact us by call , sms or email to apply for a Bridging Loan Today!
Mr Howard Tan @ + 65 84486429
Or
Ms Jasmine @ + 65 90962321
How to Qualify for a Bridge Loan >>
