Bridging Loans - the solution to help you buy before you sell
You've loved your home but decide it is time to upgrade and move on. Whatever the reason for moving house the logistics of buying and selling can be daunting.
Let us help you. Mortgage Choice - Jo Duncan specialises in helping families move house with ease. With no fees for our service, we confirm how much the banks will allow you to borrow and present you with options so you can househunt with confidence.
What is a Bridging Loan?
A briding loan is a short term loan that finances the purchase of a new property while you are selling your existing property. This type of loan can also provide finance to build a new home whilst you live in your current home. You will normally haev 6 months to sell the existing property or 12 months if a new property is being constructed.
How does a Bridging Loan work?
When you take out a briding loan, the lender usually takes over the mortgage of your existing property as well as financing the purchase of the new property. The total amount borrowed is call the Peak Debt, and includes the balance of the laon on your existing home, the contract prucahse price of the new home and any purchase costs such as stamp duty, legal fees and lender fees.
The minimum repayment on a briding loan will generally be calculated on an interest only basis, however in many cases this interested may be capitalised until the existing home is sold.
Once you sell your first property, the net proceeds of the sale (sale price minus any sale costs such as selling agent's fees) are used to reduce the Peak Debt. The remaining debt plus any capitalised interest becomes the End Debt. This End Debt is then paid as per a regular mortgage product.
Where can I get advice on my individual situation?
Jo Duncan, your local Mortgage Choice broker for Indooroopilly, Toowong and Kenmore can help with:
- Teleconference or Video Conference appointment to dicuss your plans to move house
- Review your current personal situation to develop a strategy with you for a stress-free transition from one property to the next
- Connect you with trusted property services, such as real estate, conveyancing and financial planners to help you make the move
- Put the wheels in motion by arranging your bridging loan and making sure your finances are in order all the way through to completion of selling your previous home.