All About Bridge Loans
Keywords: bridging-finance, bridge-loan, commercial-loan, commercial-lender, risks
What is a “bridge loan?” Certainly, it is not a loan for buying a bridge. It gets its name from a frequently used type of financial strategy. Properly used, it can be a decided help in achieving financial goals. Improperly used, it can be a financial disaster.
By definition, a “bridge loan” is a short-term loan used to purchase commercial property. This is something that can come in very handy, depending on the particular situation. There are two main points that you need to consider before you opt for a bridge loan. One is your needs and the other is the state of the property market.
One of the major benefits of bridge loans is that it will allow you to purchase a new property before you have sold your existing one. You will need to evaluate your current situation to determine if your needs justify taking on this type of finance. Some major questions you must field in your evaluation are:
Will you lose the new property if you can’t offer a deposit?
Would you be eligible for a discount on the purchase price if you can come up with the cash fast?
What are the existing market conditions in regard to the sale of your existing property?
Would it be possible to sell your existing property in the time frame set out in your finance package?
Most bridge loans typically run for one year and will need to be paid in full at the end of the term unless it is possible to convert it into a commercial loan. Also, interest rates will be higher on a bridging finance package.
If you do not have an urgent need for the new property and the market is slow, it may not be in the best interest of your business to take on this type of loan. On the other hand if the property market conditions are good, you can get out from under a bridging loan quickly. . However, you must realize that a bridge loan has serious risks. It is still something that will need to make sense for your business.
If you feel taking on this type of loan is the right thing to do, you will be far better off going through a specialist commercial lender. This lending institution will shorten the entire process. A lending specialist will know the market and he/she can quickly make a judgment on the best loan for you, based on your particular circumstances. It would do you no good at all if you have worked out a bridge loan package only to find out the loan underwriters have rejected the application.
Be sure to check that the loan can be converted into a conventional commercial finance package. You will also want to check on the type of interest rate and the costs you will entail if you do have to convert.
Most commercial lenders will be willing to extend the terms of your bridging finance package. If you have a buyer and you are waiting for the sale to close, a bridge loan is much more flexible and accommodating than you might expect.
Repaying your bridge loan at the end of the loan term more often than not depends on your ability to sell your existing property. If your property does not sell in the required time frame, you will be paying the existing loan on your current property, your new property and the newly converted bridge loan as well.
If you believe this may be a possibility, be sure to take a package that can be converted to a commercial loan if the need arises. Otherwise, you may have to come up with the full loan sum at the end of the finance term. As I cited earlier, bridge loans can be a decided help for your business, but there are risks. Let the borrower beware !
Bob Carper is a veteran consultant in information systems He holds a a MBA from Pitt. For additional information go to
www.secure-webconference.citymax.com. His blogsite is www.html-secrets.net You may also contact him at robertcarper06@comcast,net
Previous Articles Highlighter:
Budget Planning For Youngsters (1)
We assume that just because someone is still a teenager (s)he does not possess the power to restrain her/his spending. Now, is that an accurate picture of the millions of students populating our world?
What Is A Secured Loan? (2)
There is simply no reason that you have to work with companies that charge exorbitant fees. You can do a lot of research on the Internet to get a better sense of what is available in secured loans of all types.
Student Loan Consolidation Information - What Is The FFELP - Federal Family Education Loan Program (3)
Money for Stafford loans, PLUS loans and other FFELP loans are provided through a large national network of credit unions, independent banks and other financial institutions, lenders will feel confident loaning dollars to what otherwise may be high credit risks because the money is in the end guaranteed, at least in theory via the Federal Government, private guarantors could possibly get involved, however in the almost 5% of cases where the loan goes into default, guarantors then apply for funds to cover the loss with the Federal Government for at least a partial reimbursement of any lost money.
College Student Credit Card Debt. Tips For Parents (4)
Do students and credit cards go well together? There are many ways to find out if your university has a credit card available. As soon as you get to campus, you'll probably get a notice regarding it, but if you haven't, check the university web pages, and if there is an information center, inquire there.
Retirement Tax Planning Tips (5)
Deferring or accelerate income or deductions between tax years to minimize tax on social security benefits. Choosing distribution alternatives that delay taxation of required minimum distributions from retirement plans and IRAs.
Five Ways To Secure Online Financial Information (6)
Norton Internet Security, Avast, and CA are some of the most common security suites available. 3. Disconnect your computer when possible. Even when your computer is turned off, if it is still connected to a live internet connection it is possible for hackers to access the information contained on your hard drive.
Why Is Credit Important For Your Federal And Private Student Loans? (7)
Make sure you have well known credit card companies that will report constantly to national credit bureaus about your circumstance so they will notice your progress and give you a good report to any lender.
Student Loan Consolidation Information - What Is The William D Ford Direct Loan Plan (8)
More concrete differences between the two products do exist, though since FFELP loans are funded and serviced by private financial institutions who you sign a promissory note and could possibly not be who you re-pay the loan to, it is a basic practice for lenders to re-sell loans to other businesses, mortgage companies have been doing this all the time, you may have gone to the trouble to discover a lender and their services you like, you could have decided over and above the rate and repayment terms preferring their customer service and then for example finding the loan has been sold to another business, you may now be repaying the loan to a company you rejected, however in the situation of Direct loans since the Federal government is the lender the loans are not sold to any third party.
Mortgage Refinance-The Easy Way To Get The Adjustable Rate Monkey Off Your Back (9)
Refinancing your mortgage can be a financially advantageous move, especially for those who need to go from an ARM to a fixed interest rate. Refinancing your home presents a straightforward approach to cash out or consolidate debts with high interest rates.
Consumers 'Worried' At Thought Of Base Rate Rises (10)
The company reported that opting for an offset mortgage can help borrowers "shield" themselves from the "negative impact" of base rate hikes by the MPC. Instead of receiving interest on money put into their savings accounts, consumers are not liable to pay interest on an equivalent amount owed in a mortgage, which in turn gives them the flexibility to lower their monthly repayments.
You Can Get Loans For Wanderlust (11)
There are hundreds of less expensive places that you can set out for. Just ensure that you get some research under your belt before you book either your flight or your hotel.
Parents 'Increasingly Contributing Towards Children's Property Costs' (12)
Keywords: parents, helping, children, to, buy, property Parents are giving an increasing level of financial assistance to help their grown-up children get on to the housing ladder, new figures indicate. According to the movingimproving index carried out by Alliance & Leicester, mums and dads are contributing an average of 21,314 pounds to help their offspring purchase their first home - a rise of 3,637 pounds from the study carried out during the same time last year.
Car Buyers 'Need To Choose Suitable Finance Product' (13)
Although the financial services provider claimed that some consumers are aiming for a "new year, new start, new motor in January", the attraction of purchasing a car with a brand-new plate release in September is revealed to be "still apparent".
Financial Freedom Not Reached Until Mid 50's (14)
Abbi Rouse writes for All About Loans. Our visitors are offered advice and information all about loans, they can also apply online for tenant loans and secured loans for any purpose.
British Consumers 'Uninformed' About Personal Finance (15)
Mark Dawson writes for Loan-Arrangers .co.uk where visitors can compare cheap loans online. Then apply for the best rate secured loans and bad credit loans available. visit today www.loan-arrangers.co.uk
Of Jargon And Finance Tips (16)
All you have to do is fill out an application form and wait for the bank's representatives to get in touch with you. It really is as simple as that.
Secrets To Avoid A Home Foreclosure (17)
This is a way for you to avoid losing your house while still making an honest attempt to make the payments as required. You should be sure to deal with only respectable companies that are willing to help with the minimum of fees that are involved.
Borrowing For A Business Venture (18)
This will require you to spend much time and effort in looking out for clients to work with you. The initial years will also require you to invest a great deal.
Getting Your House Ready For The Appraiser (19)
If your house does not manage to pass muster, your hopes of procuring a large amount shall be futile. If you are trying to shift to a new house, get ready to see your house get compared to a number of other "comps".
Insurance For The Four Legged Folks (20)
Car insurance cannot be avoided anymore, what with all the accidents that keep taking place. But then, these are only some of the more prevalent kinds of insurance. These days, insurance providers are coming up with a wide range of insurance policies for many newer things.
Newer Articles Highlighter:
Employer Health Insurance Covers Fewer Employees Today (1)
The average percentage increase for small employer health insurance is between 14-15%. The prescription component is heavily weighted in this amount. The Health Insurance Portability and Accountability Act (HIPAA) or the Katzenbaum Kennedy Bill passed in 1996 has impacted how health insurers handle much of their business.
Checking Out New Communities And New Home Builders In Cherokee County (2)
If the community is well into the development stage, ask for a personal tour so that you can get a feel for the layout and the "personality" of the neighborhood.
Some Great Options - When Purchasing New Construction (3)
As was the case in years now gone by, development along waterfronts continues to a notable element of the overall new home construction in the region. Because of the prime nature of this real estate, more often than not such properties do come with a noticeable price tag.
Why People Live In Gated Communities (4)
- Gated developments are growing in popularity in places like Atlanta and suburbs of Washington D.C. - Nearly 40% of new home construction in California is in gated communities.
Custom Homes In Atlanta - Choosing A Builder (5)
Lake Arrowhead is an exceptional residential lake and golf community so close to the conveniences and attractions of the south's largest urban center, yet so very far away from the hustle and bustle of the big city.
Talking Business With New Home Builders In Cherokee County (6)
Lake Arrowhead is an exceptional residential lake and golf community so close to the conveniences and attractions of the south's largest urban center, yet so very far away from the hustle and bustle of the big city.
The Top Golf Course Communities In America: What Makes Them So Special? (7)
Today's developments are built with the classy consumer in mind and these really are the top homes for sale in America. At Lake Arrowhead, new homes are being built as you read this-they'll be available in late 2007.
Why Every Business Owner Needs To Own A Small Business Credit Card (8)
Even if your business isn't a fortune 500 company and you are not making a 6 figure income you still might need a small business credit card. Credit cards are good things to have and you never know when you may not have cash handy.
Student Loan Consolidation Information - Differences Between Graduate & Undergraduate Financial Aid (9)
Keywords: Student Loan Consolidation Info, Student Consolidation Loan Information, Student Loan Consolidation At the time of researching your student loan consolidation information options you need to investigate the similarities and differences of graduate and undergraduate financial aid, as the costs of education today is ten times what it was less than 40 years ago and with the differences becoming even more stark when considering undergraduate versus graduate programs, as luck would have it there are resources now available to both types of student to assist them to pay for college expenses.
How To Reduce The Cost Of Car Insurance For Teenagers (10)
When it comes to getting car insurance for teenagers, you really want to be able to save as much money as possible. Although many people unfortunately do not realize it, there are quite a few different things that you can do in order to reduce the cost of car insurance for teenagers, of which will be discussed here.
Trading Commodities - Technical Analysis - Expectancy (11)
The most important component of future price protection is what actual market activity has been in the recent past. As you might predict, each of these different types of analyses has its proponents and detractors.
Debt Consolidation Solution - Easy Steps To Making A Plan To Deal With Your Debt Problems (12)
Forming the Debt Plan: Now you have the key items that go into making a debt management solution, total debt and complete money available to pay the debts, you can now determine the best process to pay your debts, list information on how much may be paid to each creditor and lender each month, this way you will know when each of your debts ought to be paid off, if you are behind on any accounts or bills, get these up to date first, you can attempt to work with your creditors to get the past due amounts lowered, pay off highest interest debts first, utilize everything you have allocated for paying off debts to repay the debts with the highest interest, once you have eliminated your high-interest debt, you may then tackle the low-debt by paying off the next lowest-interest debts next, by using this method you will slowly pay back all of your debts and you will eventually become debt free.
How To Set Your Priorities When Choosing A New Credit Card (13)
Keywords: choosing a credit card, credit card selection There are a lot of good deals to be had on credit cards right now. But what is a good deal to you may not be a good deal to another consumer.
Waleska New Homes Are Going Up (14)
The country club also has a restaurant that enables those who eat there to look over the lake and enjoy its beautiful scenery. Waleska new homes community developers are under restrictions to help keep the area looking natural - according to the master planners.
Introducing Edgewater - One Of The Best Galveston County Neighborhoods (15)
There is nowhere else quite like Edgewater, and you will discover this as soon as you contact the community planners for information on your next home. You will instantly fall in love with this incredible neighborhood and the peace, relaxation, and fun that it offers.
Where Are The Best Places To Live In Texas? (16)
Texas communities have a lot to offer, and I am searching for a few basics. To me a top notch Texas community would be first and foremost, safe and beautiful.
Edgewater Is One Of The Best Places To Live In Texas (17)
Within the town center, there will be additional residences, with lovely townhomes for those who want a little less space or those who need a home in a lower price range than the rest of the community can offer.
The Facts About Poor Credit Secured Loans (18)
Poor credit secured loans cater for people who have a bad credit history or poor credit score. They may have defaulted on their mortgages or other loans, and have arrears.
New Home Features In The Top Homes To Live In Galveston County (19)
Galveston County luxury home builders are fairly easy to find, and hiring one can help you get all of the features you want in your new home. If you decide to build, make sure that you check with the local homeowner's association about specific community rules and regulations.
Choose A Custom Home In Edgewater (20)
For custom homes in the Clear Lake area, there is simply no way to beat the Edgewater community of Webster, Texas. Edgewater is the Bay Area's newest mixed-use, master-planned community on 538 acres in the heart of Webster, Texas.