Once you’ve found your dream home, there may be a few financial obstacles holding you back. Don’t let a low credit score or lack of funds for a down payment prevents you from relocating and enjoying a brand-new home. Find out how bridge loan lenders can help you move into your new home without the stress that comes with down payments and other upfront costs.
Finance Your Down Payment
Your new home requires a significant down payment. Depending on the type of mortgage you’re applying for, you could need as much as 35% as a down payment. This cost prevents many homeowners from moving into a home they could otherwise afford, particularly if they haven’t sold their first home.
Avoid draining your savings on this upfront cost with a bridge loan. A bridge loan requires no down payment. You simply borrow against your current residence in order to finance your down payment for your next home. This allows you to purchase the second home while still living in your first home.
If you’re still waiting to close on your first home, you can’t afford to miss out on a great opportunity. When the market is hot, use a bridge loan to make a quick offer and prompt closing of your new home.
Secure Funds for Essential Updates
Even after you make the down payment, there are many other hidden costs associated with purchasing a new home. Your second home may have some renovations that are necessary before you move in, or you may simply wish to add a new coat of paint, update a bathroom or perform other remodeling projects before moving in.
All of these projects cost a significant investment. While they add value to your new home, you need the financing to afford them in the first place. That’s where hard money lenders come in. A bridge loan is a completely flexible financial tool, so you can use it for any purchases you deem necessary for your new home.
Receive Financing without a High Credit Score
Finally, a bridge loan doesn’t require extensive credit check or income verification. Because the loan is primarily based on the value of your collateral, your lender isn’t concerned with a recent drop in your credit score. Whether you’ve faced some financial hardship or your credit score is temporarily low because of a business investment, you can still access the financing you need.
Most bridge loans are available even if you don’t have proof of income. As a new business owner, retiree or recent employee of a new company, traditional lenders may be hesitant to offer you financing without proper proof of stable, long-term income. A bridge loan application doesn’t rely as much on these factors, so you still have a strong application for this flexible financing.
Learn more about bridge loans and find out if this compelling strategy is right for you. Close on your new home without the hassle of a major down payment with the best hard money loans California from a reliable private money lender. Don’t wait to move into your dream home.