Friday, April 17, 2009

Understanding Bridging Finance.

When you understand what the term, "Bridging Finance" means, it is easy to know how it became its name. Everybody knows it is not easy to time the sale of one property to occur simultaneously with the acquisition of another property. The tiniest delay can do serious damage to the transactions and create obstacles that are hard to overcome. Having to pay 2 mortgages, whether for home or commercial purposes, for any length of time can spell monetary disaster.

There's a process to go thru before a bridge loan is authorized.

Bridging finance, also referred to as "bridge loans" and "bridging loans", have nothing at all to do with re-constructing the London Bridge.

Because the requirement for bridging finance often arises all of a sudden and without caution, it's a smart idea to build a relationship with a bank before the actual need arises.

When you do this you can organize to b! e pre-approved for a cited loan limit. Later, when the requirement all of a sudden arises, you will not have to wade thru all the red tape.

The characteristic term for a bridge loan runs from a fortnight to so long as 2 years. The bank has to make some money on the deal and the higher rate of interest is where the break lies.

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