When you are looking for a new house you have to be extremely careful on every stage and step. It is not easy to buy a house as it sounds. I remember the hundreds of things I had to deal with when I moved to a new and bigger (current) house with my family. It is not easy to manage the selling process of old house and buying of new one altogether. Of course, while living in your current house, you can’t sell it to pay the down payment of the new house. The option I used in this particular scenario was Bridging loan and here I would like to share what I learned about this process and what you all should know about it.
Almost every homeowner will be in this situation if they are looking to settle in a new house. The bridging finance means that the homeowner is able to take the loan to pay the down payment of the new house and close the deal while still living in their old house. The loan amount is then paid back when the old house is sold.
The maximum period you can get the loan for is 2 years. The good thing about bridging loan is that you don’t have to start paying back the loan for some months. For example, some lenders will allow you to start your payments 6 months after getting the loan. Some loans are paid off in full as soon as your old house is sold. The most important question here is where to start from. The process starts from the application that needs to be filled by the applicant and submitted to the lender.
With the availability of internet today, you can find hundreds of lending companies with their online forms on their websites. All you need to do is fill out the form and submit it online to get approved. You are mostly informed within a day after completing and submitting your application. In most cases, you are given a call from the company representative who tells you about your approval or rejection for the bridging finance. The application might take just half an hour of your time.
The important thing here is to know the requirements for getting approved. You will not be approved in almost all cases where you don’t have a current job. Also, you must be over the age of 18 in order to apply for such a loan. There are all types of companies, i.e. those providing you unsecured loan and those providing secured loans. When you take loan against the equity of your property, the loan is given only to make the down payment of your new house. You are not able to pay the current mortgage amount with this loan.