Is a Bridge Loan right for you?

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Posted by Spring EQ on May 6, 2022 9:37:45 AM

With rates on the move and home values setting records in neighborhoods across America, you know it’s a crazy market out there. So if you’re home shopping and you find the house of your dreams BUT you haven’t sold your home yet—what are your options? Here’s a way to use your existing home’s available equity if you’re short on down payment funds for your new home...

 

 

Bridge Loans are a secret weapon for homeowners shopping for a new home

 

Many homeowners looking to purchase a home—but who haven't sold the home they currently own—are learning more about bridge loans. Just what is a bridge loan?

 

A bridge loan is short-term loan that accesses your current home's available equity to "bridge the gap" between buying your new home and selling your current one. Here's how they work...

 

The loan allows you to access your current home’s available equity to use as a down payment on your new home. Then when your home sells, you pay off the bridge loan in full. One huge plus of a bridge loan? You can avoid offer contingencies in today’s hyper-competitive real estate market where in some areas, many homes are being sold for above asking price and sellers often see all-cash offers.

Bridge Loan terms can vary, but most bridge loans last from six months to just under a year.

At Spring EQ, we offer an 11-month interest-only, fixed-rate loan that allows you to borrow between $75,000 and $500,000 of your home’s value while it’s for sale and use the funds toward the purchase of your new home. Once your home sells, you can pay off the bridge loan balance. It’s a great way to shop with confidence in a market as competitive as this.

How does it work?

A bridge loan generally has the same requirements of a standard home loan, but is used on a short-term, transitional basis only. Speak to one of our loan experts to get all your questions answered. These temporary funds are meant to “bridge” the gap between selling one home and buying another. At Spring EQ, a bridge loan lets you borrow up to 85% of your available equity depending on a variety of factors, including your credit rating, home value and amount owed on your existing home.

Learn the facts—we’re here to help

There are a few things to consider before applying for a bridge loan. For instance, how much equity do you have in your home? This will be a major factor for your bridge loan. And what is the real estate market like in your area? Another thing to remember: to take advantage of the convenience and down-payment power of a bridge loan, you’ll also need to qualify for two mortgages at the same time (even if it’s only temporarily).

The bottom line? The flexibility a bridge loan provides you doesn’t have to be confusing or intimidating. That's because Spring EQ offers the leading tech and expert team to help you understand the process and make it as smooth as possible for you. Learn more about bridge loans today—get in touch with us now.

 

 

Topics: mortgage, HomeEquity, FixedRate, finance, Financial Tips, bridge loans, home purchase

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    *Details to note:
    Spring EQ customers get their cash on average in 21 business days, and as fast as 14 days. This average time is measured from the time we receive all requested documents and assumes your stated income, property and title information provided in your loan application matches your documents and any supporting information collected. The time period calculation to get cash is based on the average funding turn times over the first four months of 2023, assumes the funds are wired, excludes weekends and excludes the government mandated disclosure waiting period. Typical applicants are required to provide a current and valid completed application, proof of income, mortgage statement, home hazard insurance, and a photo ID.

    Please Note: Spring EQ does not provide tax, legal, investment or accounting advice. This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, tax, legal, investment or accounting advice. You should consult your own tax, legal, investment and accounting advisors before engaging in any transaction.

    Applicants are typically not required to provide proof of assets, and proof of income may be more extensive for self-employed borrowers. Quarterly, we calculate The Spring EQ Cash-In-Pocket Index™ which is the average reduction of our customers debt payments where at least one debt was paid off with loan proceeds. The most recent Cash-In-Pocket Index™ reported a reduction in debt payments of $530.

    Any pre-qualification is in no way a pre-approval, indication of eligibility, or binding underwriting decision.

    All borrowers will be required to meet Spring EQ's current underwriting guidelines including verification of applicant’s credit profile, debt-to-income ratio, and home’s current value. Eligible Home Equity Loan borrowers must have a FICO score of 640 and meet all other qualifying criteria in Spring EQ's current underwriting guidelines. Refinance transactions may increase total finance charges over the life of the loan. Speak to a loan officer for details. Eligible Home Equity Line of Credit borrowers must have a minimum FICO score of 660 and meet all other qualifying criteria in Spring EQ's current underwriting guidelines. Spring EQ offers Home Equity loan options up to 90% of your home value for qualified borrowers with a excluding second home or investment properties. The maximum Home Equity loan or Home Equity Line of Credit amount Spring EQ offers is $500,000.

    For details, call 888-978-9978 to speak to a licensed Spring EQ Loan Officer. Please Note: Any reference to news organizations or outlets and/or their logos or likenesses on these webpages are solely in reference to the inclusion of relevant home equity, mortgage or interest rate subject matter in current, publicly available national news items and cycles and are not meant to imply endorsement of Spring EQ in any way.