What is a Bridge Loan:
Bridge loan is also known as ‘gap financing’ because as the name suggests, it has more to do with filling or ducting the empty cracks in your financial situation especially at the point when it is a crisis financial need or emergency. which you are facing. Be it in case of purchase of personal property or in connection with business issues. This loan has become very popular among the multitude of real estate owners or businessmen, although the high rates of interest come in the form of baggage. When you are in dire need of monetary help within the restriction of few weeks before down payment or any other requirement, then loan is the only option as this loan can be available in comparatively less time with less time . Number of documents to be submitted for verification and re-verification before the loan is granted. It is a short term interim loan as it lasts only for one year.
Real life examples where loans can help:
Let us take a hypothetical case where you are looking for a new apartment or two storey house depending on your needs, requirements and unavoidable requirement. The difficulty is that you need to sell your current home to buy a new one and your broker has given up and you alone are unable to find the right buyer. Here in this situation where you are facing a time crunch for making an advance payment and are in dire need of that amount, a bridge loan becomes very useful in spite of the exorbitant interest rates. Unless you come up with a permanent solution to pay off the mortgage as well as make an upfront payment for a better deal on the housing complex, a bridge loan, or interim financing, is the only route you can take with the assurance of fair performance. can work together. of your plans with minimal official hassle.
Keeping the above example in mind, why it is said that taking a bridge loan is very flexible:
- The terms of the loan state that if you are unable to sell the home within six months, you will have to pay a reimbursement of the interest rate on the loan.
- If you are able to find a suitable buyer within the time frame of six months, you will not have to pay back the loan with payable rates of interest.
- Bridging the gap created by the time conflict between selling and buying, this loan solves all your financial woes.
What is the eligibility criterion for applying for the bridge loan:The lender will verify the credibility of your history with the loan and prove that you are not eligible for the loan. You will have to pledge any collateral or real estate property. Also, bridge loans are often offered by individual lenders and not by a bank.
If you have understood the merits of taking a bridge loan and think you need it, don’t waste time thinking and rethinking, but make the right decision of opting for this process by visiting BridgeDirect, where the funding is aimed . Solutions as lenders and not brokers.