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Do you really need a bridging loan?

Finance is Essential to Buying a House!

Finance is the backbone of the real estate sector. Without finance and its liquidity, one cannot even think about transacting in the real estate sector. At times, homeowners are willing to upgrade their properties to better locations or buy a better house. They may choose to dispose of their current property and buy a new one. This makes them go through the two basic processes of real estate transactions i.e selling and buying. They will first need to sell their existing property in order to float money and then that money can be used to buy the new house. But where will they live meanwhile? How will they manage? Will they be able to find a buyer for their property in time so that they can end up settling the transaction in time and getting the house of their dream?

Everything about this might sound easy but when it comes to finance and going through the process practically, it can be a real hectic thing and even end up as a total nightmare. What one requires here is liquid cash and there can be nothing better than financing at this stage. Bridging loan seems to be the perfect short term loan which one can acquire at such a stage.

What is a Bridging Loan?

A bridging loan, as called in the UK, is a short term financing option which generally is for a tenure of a few weeks. The only aim of such a finance is to bridge the gap between selling your current home and buying your new one. With a bridging loan, one can buy the new house without selling the current one, the loan can then be closed by selling the old house and paying off the loan in full. Bridging loans are very popular in the UK and they empower nearly 50-60% of the residential house transactions.

There are a number of financial institutions and banks in the UK which offer bridging loans and getting a loan is easy and hassle free with the right paperwork. The interest rates are also pretty competitive and worth the service and hassle free experience which is being offered in return.

Do you really need a bridging loan?

The question that arises here is that whether one really needs to get a bridging loan in order to buy a new property? Well, the answer is if it seems difficult to find a buyer of your current house on urgent basis to get hands on money then bridging loan can solve the purpose temporarily by offering financial support to settle the transaction.

The loan comes at competing interest rates due to its high demand and many providers creating a competitive business environment. Another major reason to acquire such loan is to solve the issue of relocating in a hurry or living in a temporary rented apartment before you buy your new home and make it ready for living. Remember, at times we end up buying semi furnished houses which need furnishing before one can move in permanently.

Benefits of Bridging Loan

Makes moving hectic free

Moving can be hectic if one has to sell existing house and then buy the new one. The intermediate period demand one to rent out a house temporarily. These issues are resolved when one opts for bridging loan.

Empowers the real estate sector

Bridging Loans offer the buyer with the financial power to settle transactions in real estate sector. Thus it aids the sector in a major way.

Gives cash liquidity to the buyer

At times, the real estate market is down and seller isn’t able to fetch the best price for his house. He may consider to drop the idea of selling while the market is down. And get a bridging loan to buy the new house. Later the old house can be sold at a better price to pay off the loan in complete.

How to get a bridging loan?

Getting a bridging loan is no rocket science. One can walk up to any bank or financial institution which offers it with the right set of documents. Generally, banks have a checklist of documents which you will require in order to fulfill the formalities with ease and in time. Harwood Quick Sell can do the necessary documentation for you or help you in clearing your doubts on bridging loans before you proceed ahead. Their representatives will be pleased to assist, guide and handheld you through the process of selling from financing to buying the new house.

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