Have you found your new home, but your current property is still for sale. A bridging loan may be the answer; a bridging loan allows you to borrow funds on a short- term basis to secure the purchase of your new home, until your current home is sold. Once the property has been sold or alternative finance arranged the bridging loan will be repaid.
A bridging loan is more flexible and the approval process is faster than for a regular mortgage.Unfortunately, costs are higher than an average mortgage.The lender will normally charge a fee, usually a percentage of the amount of loan, with higher monthly interest payments. This type of lending should only be used for short-term financing. If funding is required over longer terms, it is best to speak to your adviser who will guide you.
As well, by having the bridging loan secured on your property, your credit history and income have less of an impact on acceptance of the loan. The bridging loan process is regulated by the Financial Conduct Authority although there are occasions where they are not regulated by the Financial Conduct Authority.
Our advisers based in Glasgow and Edinburgh can help guide you through the bridging loan process.
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