Tuesday, 26 May 2020

3 Reasons to Use Residential Bridge Loan Lenders for Home Bridge Loans [2020]

Written by Posted On Friday, 13 March 2020 10:01

3 Reasons to Use Residential Bridge Loan Lenders for Home Bridge Loans

Residential bridge loan lenders provide borrowers with home bridge loans against the equity within their existing home which allows the borrower to purchase a new home. Residential bridge loans can be a great option for homeowners who have plenty of equity in their home but don’t have cash available for a down payment or all cash offer to purchase a new home.

1. Residential Bridge Loans Prevent Moving Twice

If the homeowner does not obtain a residential bridge loan and instead chooses to sell their current home to raise cash for the new home purchase, they will be forced to move twice. The homeowner will have to move to temporary housing to sell their existing home and then move again once they have purchased their new home. Moving twice involves extra expenses, time and inconvenience. The added cost and burden of moving twice is a significant reason many homeowners choose bridge loans for home purchase purposes.

Using the services of a residential bridge loan lender, the homeowner would first obtain a home bridge loan against their current home to raise cash and purchase the new home. Once the homeowner has moved into their new home, they sell the previous home which pays off the residential bridge loan.

Residential bridge loans can also be used in reverse order. The bridge loan lender can secure the loan against the new home being purchased. Once the previous home is sold the bridge loan against the new home is paid off. Some residential bridge lenders will even have the flexibility to secure bridge loans against both the previous and new homes.

RELATED: What is a bridge loan?

2. Residential Bridge Loan Requirements are Lenient

Residential bridge loan lenders are often private lenders (hard money lenders) who are able to provide fast and flexible bridge loan financing with relatively few requirements. The main requirement for a residential bridge loan from a hard money lender is having enough equity in the existing property that will serve as collateral.

Borrowers with poor credit or other issues on their record such as foreclosures, bankruptcies, short sales, etc., can still receive bridge loan financing from a hard money bridge loan lender. Hard money lenders are primarily concerned with the value of the property and the borrower’s equity within that property.

Hard money bridge loans can be funded within 2-3 weeks. The application process for a hard money bridge loan just requires a simple 1003 loan application. Residential bridge loans are written for 12 months or less and do not require income verification as the sale of the previous home will pay off the home bridge loan. Residential bridge loans have a special exemption and are not mandated to meet the normal “Ability to Repay” requirement.

3. Bridge Loans for Seniors - Financing for Those Without Sufficient Income

Bridge loans for seniors are popular as many retirees cannot obtain conventional bank loans. Seniors often are without significant income needed to qualify for a loan as their debt to income ratio would be too high. Many seniors in need of conventional loans are not able to qualify for a conventional loan under the current federal regulations. However, seniors would be able to qualify for a residential bridge loan if they have sufficient equity in their home.

Where to Find Residential Bridge Loan Lenders?

North Coast Financial are California residential bridge loan lenders providing financing throughout the state. Outside of California, residential bridge loans are commonly offered by private hard money lenders.

 

 

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Jeff Hensel

North Coast Financial, Inc. is a California hard money lender with over 37 years of experience specializing in various types of hard money loans including probate and estate loans, investment and rental property loans, bridge loans, fix and flip/rehab loans, purchase loans, cash out and refinance loans and other hard money loans with California real estate as collateral.

https://www.northcoastfinancialinc.com/

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