Hard Money Bridge Loan: #1 Best Resource for Private Lending
Bridge loans are a type of hard money loan. Also known as gap financing, interim financing, and swing loans, these short-term loans allow you to put a contingency-free offer on an investment property.
Do I Need A Good Credit Score For Hard Money Loans?
Your investment property — not your finances — secures the loan. You do not need a stellar credit history to be approved for hard money loans. While there is no definite benchmark, most lenders will approve applications for credit scores as low as 670.
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What are the risks of a bridge loan?
Perhaps the biggest risk of a bridge loan is that if your home doesn't sell by the time you need to begin repaying your bridge loan, you're still responsible for the debt. Until your old home sells, you'll essentially be paying three loans: the two mortgages on the houses and then also the bridge loan.
What credit score do you need for a bridge loan? Since the sale of the current property will automatically pay off the bridge loan, the lender can be reasonably certain they will recoup the loan amount. A credit score of 670 and above should be easily approved by private money bridge lender.
Are bridge loans A Good investment?
Bridge loans are one area where investors are likely to find consistent low risk and high rewards compared to similar investments offering a fixed income. Simply put, bridge loans are used for commercial real estate when more traditional institutional financing sources may not be available.
Can anyone get a bridge loan?
Bridge loans come with higher interest rates and APR. Most lenders require a homeowner to have at least 20% home equity built up before they'll extend a bridge loan offer. Many financial institutions will only extend a bridge loan if you also use them to obtain your new mortgage.
How long does it take to get a bridging loan approved?
Depending on various factors, a bridging loan can take anything from 72 hours to a couple of weeks to complete. It's not the quickest type of finance to get approved due to its complexity, but lenders are typically expert and very agile in getting the information they need.
What is the average interest rate on a bridge loan? Bridge loans typically have interest rates between 8.5% and 10.5%, making them more expensive than traditional, long-term financing options. However, the application and underwriting process for bridge loans is generally faster than for traditional loans.
Can you use a bridge loan for down payment?
Bridge loans are generally used in one of two ways: As a way to pay off your current mortgage, putting any excess toward your new down payment. As a second mortgage that becomes your down payment for the new house.
How is a bridging loan calculated?
The amount of equity in your existing property determines the extent of bridging finance available. Interest on the new finance is calculated and capitalised for up to 9 months1, although if you haven't sold by then, a 3-month extension may be possible, subject to normal lending criteria.
Looking For a Hard Money Bridge Loan?
CLICK Here For Instant Hard Money Bridge Loan Application!