Is Bridging Finance a Good Idea?
All debt products have a degree of risk for the recipient and lender. Bridging finance is no different. To minimise the risk, we encourage our clients to borrow the correct amount. Homeowners who get themselves into trouble with this home loan overestimate the potential sale price of their current home. Therefore, they cannot repay the entire loan and they carry their mortgage too.
The amount of bridging loans is based on the estimated sale price of the current house. Lenders will finance a 70% to 80% loan-to-value ratio. Homeowners use it to purchase their new homes. When the current property sells, the proceeds repay the bridging loan. Therefore, it’s a short-term solution. Ideally, the home sale will net enough to repay the loan and some leftover funds that the homeowner can use to furnish the new place, or something else. The point is to give the homeowner some breathing room through the financial product.
Our Mortgage House loan specialists have access to proprietary tools that help them evaluate applications efficiently. Plus, they can deliver competitive loan terms. Our tools allow them to see when a homeowner can borrow more or should borrow less. We also make some of our tools available to our clients online. For example, you can explore our Mortgage House mortgage choice calculators online for free.
Bridging Finance Conclusion
In many cases, bridging finance accomplishes its purpose for homeowners. To ensure that you put yourself in a financial position to succeed, contact our Mortgage House loan specialists to obtain more information today.