If you have not managed to sell your current property but are still looking to purchase a new home you have fallenm in love with then a bridging loans is a way to get things moving. A bridging loan allow movers you to buy a new property before the sale of your current property goes through.
There are two main types of bridging loan: the 'closed' bridge and the 'open' bridge. A closed bridging loan is only available if you have already exchanged on the sale of you existing property. Very few sales fall through after exchange, so lenders are happy to offer closed-bridge financing. An 'open' bridge is taken out by buyers who have found their ideal property, but their existing home remains unsold.
To take out a bridging loan you will need to be able to prove that you can afford to pay your current mortgage as well as the bridging loan interest. If you have a lot of equity in your home this may be a feasible option for you.
A bridging loan is typically takne out for 12 months which should be enough for you to sell you original home and use the funds to pay off the loan.
Bridging loans are always secured against a property, even if it is in need of renovation or restoration