In most cases, property owners sell their old home first, and then buy their new home with the available equity. But there are times when buying first may suit you better. A bridging loan provides you with the funds needed to buy your new home before you’ve sold your current property.
Helping you secure your finances between the buy and sell
You have found your new dream home, but haven’t sold the one you’re currently in. You’ll need finance to meet the gap between receiving funds from the sale of your existing home and buying your new property. This essentially gives you a line of credit to cover the ‘bridge’ between purchasing the new property and receiving settlement funds on the old.
You will usually have 12 months to pay off the bridging loan and it will be closed once your existing property is sold. In most cases, the interest on the bridging loan is capitalised – this means you do not have to pay any interest before you sell your current property. Once you have sold this property, then the interest accrued is added onto the loan amount. This allows for better cash flow. If you are upgrading your home and need help bridging the gap, get in contact with Guardian Group.Contact us to help bridge the gap