What is a Bridge Loan: A credit bridge is also known as 'gap financing' because, as the name suggests, it has more to do with the filling or leaking of empty slots into your financial situation, especially when there is an emergency monetary need or a crisis with you are faced with buying personal property or business related issues. This loan has become very popular among the crowd of real estate owners or businessmen despite the high interest rates that come as a baggage. When in dire need of monetary support and even within weeks of making payments or any other necessity, then a loan is the only option because this loan may be available in a shorter period of time compared to a minimum number of documents to be submitted for verification and reconsideration before the loan is issued. It is a short-term temporary loan as it lasts only one year.
Real life examples where loans can help: Let's take a hypothetical case where you are looking for a new apartment or a two-story home depending on the inevitable needs, requirements and requirements. The difficulty is that you have to sell your current home to buy a new one and your broker has given up and you just are not able to find the right buyer. Here in this situation where you are facing time limitations for prepaid payments and you need it for that amount, the bridge loan becomes very useful despite the excessive interest rates. Unless and until you come up with a permanent settlement to pay the mortgage and to make the advance payment for a better deal in the housing complex, bridge loan or temporary funding is the only way you can act with ensuring the proper execution of your plans with minimal official problems.
Bearing in mind the above example, why it is said that getting a bridge loan is very flexible:
Credit terms state that if you are not able to sell your home within six months then you have to pay the interest rate repayment on the loan.
If you are able to find an eligible buyer within the six months time period then you will not have to pay the interest rate loan.
By overcoming the breakdown between the time of the war between sale and purchase, this loan solves all your financial ties.
What is the eligibility criterion for the application for bridge loan: The lender will carry out a credibility check of your credit history and everything that proves you are not worthy of credit. You will have to pledge any collateral or real estate. Also, bridge loans are often provided by individual lenders and not by any bank.
Source by Shalini Madhav