A couple of years ago my wife and I were in the process of selling our house. We were pretty sure we had found a buyer and had agreed on a price acceptable to both them, and us but they wouldn’t be able to buy our house for about three months. My wife and I were totally ok with this since we weren’t in any particular hurry to move, we just wanted to move into a bigger home outside of town, somewhere a bit more rural.

Well, one weekend while we were driving around the countryside looking at houses, we saw the perfect farmhouse. It was exactly what we were looking for. Not too far out of town, on a quiet road, overlooking a little lake and surrounded by tall oak trees. In short it was perfect.

We contacted the selling agent and found out that the price was within our budget, but only just. We told him it would be three months before we’d be able to buy it and this caused him to pause. Apparently there was a lot of interest in that little house and he couldn’t justify delaying the sale for three months. So we let it go.

Why a Bridging Loan?

We did find another beautiful house so the story has a happy ending but is there anything we could have done to get that first house? The answer, had we known it at the time, would have been a bridging loan. Bridging loans are short-term loans offered by commercial lenders to borrowers for a specific purpose. They can range in time from two weeks, for a very short loan, to up to three years for commercial bridging loans. Homebuyers who have not yet sold their property and wish to buy require these bridging loans.

Interest Rates

The interest rates are probably higher than for your typical mortgage but this is because of the added flexibility and convenience you have from the lender. There will also be set up fees involved. However, they may work out at significantly cheaper than some of the alternatives such as renting accommodation. There will also be many situations in which the price will be well worth paying if it means getting your dream home.

You should always shop around before agreeing to a bridging loan as rates and fees can vary significantly. You don’t have to get it from your mortgage provider although there may be advantages to doing so.

Joseph Kenny is the webmaster of the loan information sites http://www.selectloans.co.uk/ and also http://www.ukpersonalloanstore.co.uk. At the Personal Loan Store you can find all the different loan types explained.

Share This

Home improvement loans are designed solely for the purpose of home improvement. It also increases the value of your home. It’s an addition or modification of your property. Home improvement requires money; you are not always financially sound to invest money for renovation. Home improvement loans are there to help you in renovating your home.

To beautify your home means to bring in more luxury and comfort. Almost everyone feels that home is the place where you find peace and a sense of security. You come home after a hectic day schedule to get peace. If your home is having all comforts, it would be more relaxing. Home improvement loans can bring luxury and comfort in your house.

Home improvement loans are given to homeowners. It is like personal loan. Secured home improvement loans are offered against the collateral. Unsecured home improvement loans do not require any collateral.

The main advantage of secured home improvement loans are that, you will get loans at a lower rate of interest with longer repayment period. But, sometimes lenders repossess the property of the borrower due to defaults in repayment.

Unsecured home improvement loans are offered by lenders at comparatively higher rate of interest. It can be justified in the absence of collateral. But, there is no risk of repossession of the property unlike secured loans. Also, loan approval and processing is fast.

Home improvement loans can be used for renovating your home, designing your kitchen, bathroom, wall painting, landscaping, etc.

When you go for home improvement loans, shop around for the best loan deal. Get quotes from different lenders. Compare the quotes and choose the one as per your requirement.

About The Author
The author is a business writer specializing in finance and credit products and has written authoritative articles on the finance industry. He has done his masters in Business Administration and is currently assisting Shakespeare Finance as a finance specialist.

For more information please visit: http://www.shakespearefinance.co.uk

Share This

For the last few years home prices have been rising about as quickly as gas prices. The market has already priced out a sizeable chunk of Americans, and as prices continue to climb, more potential homeowners are going to get left out in the cold.

Good news! The same builders who have been raising prices and banking record profits are about to get caught by their own greed. New home inventories are reaching record levels, and there are even more in the construction pipeline.

What does all this mean? It means supply is exceeding demand, and that means a buyers market may be on the way.

Interest rate hikes are putting the squeeze on buyers, raising minimum monthly payments on homes they could have afforded when rates were lower. The result is, buyers can’t afford to make the payments on the houses builders have in inventory, and they won’t be able to afford the ones that are in construction now.

The solution? There’s only one viable road the builders can take, and that’s to offer discounts. Tossing in pricy extras for free, the stategy they are taking now, isn’t going to help get a overstreached buyer into a home; they have to lower prices.

Builders are currently playing a high stakes game of chicken with buyers. First they claimed there was no bubble, and now they claim the market is simply cooling. Nice PR, but don’t buy it. The Fed would rather let the housing market take a hit now, than let inflation destroy the economy. The more rates rise, the harder it gets to sell homes. There’s already nine months worth of inventory. Who wants to bet the builders are willing to let that hit 18-24 months?

So inventories are rising, prices are rising, property taxes are rising, and interest rates are rising. Guess what else is also rising? Mortgage defaults. Ouch! Uncle Sam is going to be coming to market with a barge load of homes all over the country, and he could care less about making a profit, he just wants out. What’s that cracking noise? Someone snapping?

By early fall, builders, speculators, private sellers, the banks, and Uncle Sam are going to be fighting over buyers. That’s a game of chicken none of them are going to win. Prices are going to fall; how hard, and how fast remains to be seen.

As a buyer, there are two things you need to look at: will rates rise too high, and eat up any discount a builder may give, or will prices fall faster than rates rise and provide you with a better deal?

A third factor that many people forget to figure in is inflation. If prices on goods and services rise due to increasing gas prices, this leaves less money in the budget. Credit becomes more expensive as rates rise, and savings dip to cover the extra costs that already stretched paychecks can’t meet.

While this may seem like bad news for buyers, it is worse news for builders, investors, and banks. Home sales slump, mortgage applications dry up, and the entire industry looks to the Fed to save it. Flash back to the early 1980’s. Everyone’s looking to sell a home, and no one can afford to buy one.

So which is it going to be? A buyer’s market or a seller’s profit buffet? Let your cell phone be your guide. The more aggressive real estate agents get, the harder it is for them to make a sale. If they are not calling you several times per day, seven days per week, they have enough buyers to go around. When you phone won’t stop ringing, and the agents are camped in front of your doorstep, then you know they are hungry.

This is one time when a wait and see attitude may wind up paying off big. The real estate PR guys may be calling this “cooling,” but buyers are going to call it what it is; good news.

Chris Yarbrough writes for the eBay-Guides.com His home buying guides can be viewed here.

Share This