Excite

Getting instant finance through bridging loans

If you are in the position of needing relatively instant finance but need the opportunity to set up a mortgage, bank loan or hire purchase agreement, then a bridging loan will offer the funds you need with none of the hassle. A bridging loan is specifically designed to fill financial gaps and allow you the time to sort out relevant finance without losing out on your much needed purchase. The most common type of purchase to use a bridging loan is the purchase of a home. This type of instant finance is used because it is quickly approved and it covers the time period in between the purchase and the setting up of a mortgage.

A bridging loan does usually have to be secured against some form of collateral, in the case of a home purchase, it is usually the person's old home that they are trying to sell which the loan is secured on. This allows the person to make the purchase of their new home, and gives the instant finance company some security that their loan will be repaid. Once the purchase has been made and the old home sold, the person's mortgage will be used to pay back the bridging loan company. You normally only pay interest on a bridging loan until the home is sold as the funds from the sale will usually clear the loan.

There are small instances where a bridging loan will become slightly longer-term than expected. This may be as a result of a house sale falling through or a piece of collateral taking longer to sell than anticipated. Most instant finance companies will honour your agreement and keep your loan open for a specified period. However, due to the high interest rates often associated with this sort of credit, you are probably better seeking an alternative funding source.

United Kingdom - Excite Network Copyright ©1995 - 2020