5 Uses For Businesses
Sep 19, 2018 // By:admin // No Comment
Banks and the other financial institutions or companies have a financing solution and alternative that they offer for their customers, business and individual customers in the form of bridge loans. In most cases when homeowners are in the process of buying a new home while selling the one they have, they will be in need of money to fend for this need. There are a number of the other reasons that send homeowners and individuals to go for the bridging loans such as the case where they use them to settle some expenses such as divorce expenses, estate taxes and as well some use them to help save their key investments from foreclosure. If you are intending to make a purchase of a new home, then the bridging loans can be quite helpful for you to manage a down payment. Bridge loans and the home equity loans are the two alternative financing options that as a home owner you will have before you when it comes to such times of financing. Below we will be taking a look at the two alternatives at hand for your financing needs as a borrower.
The first fact is that when it comes to the home equity loans, as a borrower you stand to benefit from the fact that these loans come at such low interest rates. However, with this said and done, you need to be alive to the fact that with the house as the collateral in these loans, in the event of default you stand at such a high risk of losing your home. Anyway, even looking at bridge loans, these are as well financing options that will see you attach your home as the collateral. Bridge loans however have a number of benefits and one of these is the fact that they do have quite a short term, being short term loans whose terms never go beyond 3 years.
As such you will be able to deal with the loans balance over just a period of some months being spread over that period as opposed to the case as it is with the home equity loans where you would have to deal with the same over such a period as long as 20 years in some cases. Remember the fact that when it comes to loans, the longer the repayment period, the higher the risk that at some point in time they may get to default and the risks of losing your pledged collateral happen to be as apparent. Bridge loans are even further a benefit for the fact that the borrower can actually choose a repayment plan, pay the loan earlier and besides this there are no repayment penalties levied.