Wednesday, October 08, 2008

Bridge to a New Home

Are you moving from your current fabulous home to your next? If you already own a home, chances are you are going to need to consider bridge financing to purchase your next home to make ends meet between selling your current home and buying the next.

Bridge loans are secured loans, requiring you to pledge your property as collateral. The lender will approve an amount of up to the full value of the property. This way, you can borrow greater amounts for purchasing a new home.

Residential bridging loans are short-term financial arrangement. This implies that the money is borrowed for few weeks to a year. It is when you have found the money from own source like by selling some old property that you can repay the principal amount in one time. Until then, you have the option of making the interest payments only.

However, despite being secured loans, interest rate is generally higher. This is because these are short-term loans.

See the full original article by Eva Baldwyn.

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