Many of us currently live in a property that we cannot properly call our home because it was probably our second or third choice because finding the dream home seems to be something that is totally unachievable. The day will come however when you see a property that you know is just right for you and your family and the downside to finding this dream property is that you need to sell the one that you are currently in before you can even entertain the thought of buying another. This means that your dream home that you are meant to be living in will be snapped up by someone else and you will regret this for the rest of your life. This is a situation that many people found themselves involved in before, but finally there is an answer to this dilemma and it comes in the form of a bridging loan. If you are a little bit unclear about what a bridging loan exactly is, then if you take the time to ask for a Bridging Loan Quote with Ascot Bridging Finance then they will tell you exactly about its purpose. It is designed to provide you with the finance that you need to purchase your dream home while waiting for your current property to sell and for everything to be finalised. This is not like the mortgage that you took out on your original home because it is seen as a short-term loan and it is something that you can pay back almost immediately once you get paid for your old property. It can be used for the above reason and it can also provide you with many other benefits, and the following are just some of those.
- No missed opportunities – As was briefly mentioned before, it would be an extreme shame that you miss out on your dream home because the buyer that put the bid in on your current family home is now beginning to have second thoughts and it looks like they are going to pull out. This means that you won’t have the necessary funds to purchase your dream home and so this is when bridging loan can come to the rescue. You won’t risk losing the home of your dreams and so you can continue with your plans and buy the property until such times as you find a buyer for your old home.
- More to choose from – If you are restricted by the fact that you need to sell your own property before you can put a bid in on another then this greatly reduces the amount of properties that you can choose from. Having the ability to take out a bridging loan allows you to not be limited by these constraints and so you can buy the property without having to wait for your other one to sell. You may also be able to negotiate the price down a little because you can guarantee the seller that you do have the necessary funds to purchase.
- It’s going to save you money – If you are unable to buy a new property until your old property sells, then it’s going to involve you having to leave your current property so that estate agents can show people around in the hope that they will put in a bid. Due to the fact that you can’t live there even though it is your home, you might have to rent an alternative property until such times as the property sells. Depending how long this takes, it could amount to a significant amount of money and so it would make a lot more sense if you took out a bridging loan and bought the property of your dreams while waiting for your old one to sell.
- Create a seller’s market – If you are under pressure to sell so that you can use the money to buy your dream home then you might be tempted to drop the price a little and so this is money that you are missing out on. Knowing that you can take advantage of bridging loan will allow you to hold out for the best price possible while you are living in your new home. This could amount to a significant amount of money and we are talking about thousands of pounds here so it is not something that you want to take lightly.
- For essential renovations – Some people try to make a handsome profit by buying and fixing up a property that needs an incredible amount of work done to it. Normal lending institutions like banks and building societies will not be able to provide you with a mortgage to do the things that need to be done and so this is where a bridging loan can prove itself to be very invaluable. You could get the lump sum and then carry out the necessary refurbishments and repairs and then later rent the property out or sell it. You could essentially flip the property and make a handsome profit along the way.
If this sounds like a very sound proposition and it’s one that you would like to take advantage of then there are a few rules and stipulations that need to be followed. It’s likely that your lender will want you to use your current property and the property that you want to buy as a security for your bridging loan. You may be in a situation where you still owe money on your existing mortgage and so your lender needs something to back this up. You should be aware that the interest rates will be higher for a loan such as this and there will be administration dues as well. The thing to remember however is that bridging loans are only designed to last a few months and so even though interest rates are higher, you will be borrowing the money for a shorter period of time and so everything pretty much balances itself out.