Bridging Loans
Bridging Loans
Bridging LoansBridging Loans can also be used for other purposes other than buying new property, for example, to buy a new Car, etc.The repayment period varies from person to person, depending upon the amount. However, the person is recommended to repay it as soon as possible. If a person takes a longer time to repay the loan then the loan gets expensive due to higher interest rates charged on it.
Bridging Loans can be availed by almost everyone, whether a good credit scorer or bad credit scorer. However, as compared to a bad credit scorer, the interest rates for a good credit scorer are low, and they can also borrow a higher amount. The lender takes into account three factors before lending, which are.
1. Financial Status of a borrower.
2. Value of the property of a borrower.
3. And flow of income.
Furthermore, this type of loan has several advantages as well as some disadvantages. For instance, the advantages are that it is a quick way to get instant approval for the loan, and it usually takes only 24 hours to provide funds. They can also be repaid faster than the standard loan as they are short term loans. Bad Credit Scorers can also avail it.
The disadvantage is that they are very expensive. If the borrower fails to pay back the loan, then he has the risk of losing his asset. Moreover, higher interest rates are charged on them.
If the property is not sold before the loan is matured, then it can usually be converted into Conventional Loan without any penalty fee. However, it is best to ask the lender about this before borrowing the loan.
Source : www.theinfow.com