What is bridging finance?
In most cases, people sell their current home before buying a new one or do both at the same time as a simultaneous settlement. Sometimes however, you find your dream home before yours has sold.
This where bridging finance comes in - to bridge the finance gap until your current home is sold.
How much can I borrow?
Subject to borrowing capacity, you may be able to borrow up to 80% of the cost of your new home. Repayments are generally interest only for the bridging period, with the final payment on the sale of your home paying the principal and interest.
How is the loan structured?
This depends on your current loan structure. Where your current loan is fixed, a bridging loan is done as a separate new loan. If your current loan is variable, you can refinance your existing loan into a bridging loan. It is important to remember bridging loans are short-term and are only available for up to 12 months.