Closed Bridging Loans
There are two main types of bridging finance ‘closed’ and ‘open’. Open bridging is less secure for the lender and allows for a bridging loan even though one or more properties being used as security, one not sold.
Closed bridging finance is a popular type of loan used by new property purchasers and is regularly used to buy a new home whilst awaiting completion (after exchange of contracts) of your current residence. The sale normally has a completion date which is when the bridge is repaid in full. Very few sales fall through after exchange so lenders are happy to offer closed bridging finance and potentially at a reduced interest rate.
Purchase a new home with a Closed Bridging Loan
Your property has sold and exchanged contracts and completion will be taking place at a given date in the future. In the meantime, your dream property has just been put up for sale and has had lots of interest. You don’t believe that you will complete the sale of your current property in time to purchase your dream property, prior to it being purchased by someone else. A closed bridging loan can be secured on either your current property, the new property or both thus allowing you to purchase your dream property. The bridging loan can then be repaid when you receive the proceeds from the sale – use our bridging calculator now to work out your repayment.