Property bridging finance Bayhead
Wanting to buy a new home but haven’t found a buyer for your existing home. You should be looking at property bridging finance. You can fund the purchase of your new property in Bayhead before your existing home has been sold, which means you don’t miss out on buying the home of your dreams just because you have to wait until you’ve sold your existing home.
Bridging finance is becoming the go to source of finance for those looking to raise money for a home purchase under a tight deadline, we at Bayside Finance Solutions can provide the solution you are looking for.
What is property bridging finance?
Bridging finance is a type of short term loan that allows property owners, developers and investors to access money quickly to cover both an existing home and the new property you’re looking to purchase. Repayments on your property bridging loan are usually calculated on an interest only basis during the period it takes to buy your new house and sell your existing one – called the bridging period.
At Bayside Finance Solutions in Durban we will consider loaning to people living in Bayside even if their credit score is less than perfect, since your property is being used as collateral and leveraging its value in order to bridge a short period of time and borrow short term finance.
Accessing bridging finance can be accessible in around two to four weeks, compared to a mortgage from a South African bank which could take several months.
In case the home you are living in at the moment takes longer than expected to sell, and to help reduce your total loan amount, it is often a good idea to continue making repayments so you’re not left with a large lump sum to pay back. Property bridging finance can be a tricky form of finance, so it’s worth getting advice from a specialist who knows their business when it comes to mortgage to ensure you understand all of our loan requirements.
How does property bridging finance, Bayhead work?
Bridging finance is usually secured against a property.
A bridging loan is calculated by adding any debt owing on your existing Durban home to the value of your new home, and then subtracting the potential sales price of your existing home.
The amount leftover is called the principal and in most cases during the bridging period you’re only required to pay back the interest calculated on the principal. Interest will be compounded monthly though at the standard variable rate and added to your principal or ongoing balance. This amount will become your mortgage on your new property once your existing home has sold.
Bear in mind that during the bridging period, you’re essentially paying off the interest on two properties, so selling your existing home is a priority
What are the benefits of bridging finance for your Bayhead home?
Bridging finance takes away the pressure of having to match up settlement dates, allowing you sell your property without worrying about losing it entirely. It is the best way of buying the home you want immediately, letting you secure a new home without having to spend weeks worrying about selling your existing property first. It is also an ideal option for finance if you’re considering building a new home in Bayhead, Durban while you live in your current home.
A mortgage can take weeks, and getting a definite buyer for your current property may take time. This is one of the most common reasons why Bayside Finance Solutions has so many clients wanting advice and a bridging solution, as it helps to ‘bridge’ the gap between selling and completion, enabling you to obtain your dream home.
What to consider?
Get good advice about propertybridging finance before making any decisions. There are a few factors to consider when deciding on whether or not bridging finance is the right option for your particular situation in Bayhead, Durban:
- What period of time do you need the funds for?
- What is the average time properties are taking to sell in your area?
- How soon can you get your existing home ready for sale?
- Are you building a new house or buying an existing property?
- Will you be able to meet the repayments on your current loan and your bridging loan?