Are you an ambitious investor living through a pinch? Are you wondering how to close an existing loan quickly? Do you wish to invest on newer properties? If yes, you require the assistance of a bridge loan. By definition, bridge loans are meant to cover the gap between the purchase of a new property and the sales of an old one. Hard money loans are extremely handy if you have not sold the old property. According to experts, many homeowners plan on new investments without completing their older loans. The new investments can turn into a heavy burden on your shoulders. This is when bridge loans become useful! To be more precise, bridge loans turn into a real life saver.
Terms and Conditions
Terms and conditions that bind bridge loans differ from one lender to another. You will see sharp differences in the conditions, terms and costs. Some lenders pay off the old mortgage and help buyers invest on new ones. Now, you should pay the price for the new property and the old debt that was cleared by the hard money lender. Of course, hard money lenders will force you to pay heavy interest rates too! Luckily, bridge loan lenders share few common characteristics. For example, they begin with six month terms and finance requests with a minimum interest of 2%!
Real estate ventures are known for its risky nature. The market is filled with many untold and unseen risks. Bridge loans are riskier than traditional mortgages. However, lenders are always looking for business. That is why bridge loan lenders help borrowers clear existing mortgages quickly. In less than 9 days, you will be able to close a home loan. Doesn’t this sound too good to be true?
Know Your Current State
Bridge alias hard money lenders know that the right property brings attractive deals and monetary fortunes. There is a good demand for bridge loans when borrowers give top priority to their new investments. Diligent borrowers who have done lots of homework will definitely have an advantages. If you wish to easy close an existing property loan, here are few tips to be remembered:
1) Disclose all details of environmental issues around your property.
2) Keep track of profit-loss statements and rent rolls
3) You shouldn’t have any hidden liens or judgements from the lender
4) Never surprise the lender with issues that can delay closing