How Can I Stand To Benefit From a bridge loan?

How Can I Stand To Benefit From a bridge loan?

When it comes to home loans, many investors approach banks. While banks typically offer long-term mortgage loans, there are alternative sources of financing your new home. Bridge loans are the most popular types of alternative financing options.

Known for flexibility and quick turnaround, many home buyers are now seeking bridge loans. A bridge loan can prove to be beneficial for individuals and real estate companies.

Before you become familiar with its benefits, it’s important that you understand some basic facts about bridge loans:

Bridge loan 101

  • A bridge loan is a short-term loan (6 months to 1-year).
  • Private parties issue bridge loans.
  • The terms and conditions of a bridge loan may vary, depending on the contract between a borrower and a lender.
  • A bridge loan is backed by collateral (the existing property).
  • While traditional loans are based on credit score, bridge lenders are more concerned about a borrower’s collateral.

Why seek bridge loans

It makes much more financial sense to seek a bridge loan than a bank loan for buying a property. Here is why:

  • Immediate access to money before property sale: Banks can take around a month or more to provide home loans. This is because banks spend time verifying borrowers’ loan applications, credit score, employment history, and other details. Similarly, if you want to sell your home before buying a new property, this can also take months.

 

Meanwhile, you can get a bridge loan in no time. A bridge loan offers immediate short-term cash that you can use prior to selling your property. The loan will be taken against your current home in order to finance the purchase of your new home. Once your home is sold, you can use the money to pay off the bridge loan.

 

  • Flexible terms: Unlikebank agreements, bridge loan contracts include flexible repayment terms and conditions. Borrowers can negotiate suitable terms, including repayment schedule with their lenders. Lenders do not care about your credit score or previous debt history. They are simply concerned about the value of your property.

 

  • No monthly repayment: Not all lenders require borrowers to make monthly interest payments. Many lenders ask for repayment once the property has been sold.

 

How to choose bridge lender

It’s important to select a lender that specializes in bridge financing. After determining your financing needs, make sure you choose a reputable lender who can offer you a bridge loan for your specific requirements.

Global Capital Partners Fund Limited is one of the most reliable bridge lenders in NYC. They offer tailored solutions to cater to each client’s business needs. If you have any questions, get in touch with them now.

 

Leave a reply

World Headlines