Are Bridging loans and hard money loans the same?
Are Bridging loans and hard money loans the same
?These loans are short-term loans, which are obtained for a quick financial support for buying a new property or a home while waiting for the sale of the existing one. They are very expensive as they have a higher rate of interest. They can be obtained by anyone, and they can be repaid quickly as compared to standard loans and are also obtained quickly in the hour of need. Nevertheless, if the borrower fails to pay back these loans than their asset would be at the risk of losing as they are obtained on the security of the borrower's property or home. They can also be used for other purposes other than buying a new property or home. They are the best option when you want to buy the house whichyou havealways wanted, but you cannot afford to buy it.
Hard money loans hold even higher interest rates than prime loans. As traditional lenders like banks do no lend hard money loans, hard loan lenders are usually people who see the value of such potentially dangerous risk. This type of loan is used in situations change, short-term financing, and to recipients with pathetic credit but substantive equality of the property, they want to avoid foreclosure.
However, if you take a longer time to pay back the loan, then higher interest rates can also be charged. Therefore, to avoid the higher interest charged to you. You should always try to pay back the loan as soon as possible. The Bridging Loan and Hard Money Loan have similarities as well as some differences, which are described above.
Source : www.theinfow.com