Author: Jay Hurst, Co-Founder of Hurst Lending
For more details on our residential bridge loans offers please visit us at: https://hurstlending.com/other-offers/residential-bridge-loans/
What is a Bridge Loan?
A bridge loan is a short-term financing solution that bridges the gap between the purchase of a new property and the sale of an existing property or to bridge until a home buyer can qualify for a conventional loan. We offer a full line of residential bridge loans to high-quality home buyers and real estate investors. Some of our bridge loan borrowers don’t quite fit Fannie Mae and Freddie Mac’s specific underwriting guidelines and others simply want to use our funds for their convenience and/or tax reasons.
How Does a Bridge Loan Work?
Our model is simple: we supply funding to the home buyer/investor on a short-term basis, and they either pay off our short-term loan in full or refinance them into a conventional loan within six months. We only lend to customers who will qualify for a conventional refinance or have another reasonable plan to pay off our loan within six months.
A common use for residential bridge loans is when a borrower needs to purchase a new property before selling an existing one. This can happen in situations where the borrower has found their dream home but has not yet received an offer on their current property. The bridge loan allows them to make the purchase without waiting for the sale of their existing property.
Residential Bridge loans are also commonly used by home buyers or real estate investors to purchase properties that require renovations or repairs. For example, an home buyer might not qualify for a conventional loan because the new home they want to purchase needs some repairs (or even because their old home needs repairs and they want to wait to make the repairs until they move into their new property). With our residential bridge loans, you can use our funds to purchase the property, make the necessary repairs (to their new home or old home), and we will then refinance you into a long-term conventional mortgage.
Other buyers simply want to use our funds for their convenience and/or tax reasons. You may want to buy now without having to liquid assets or you may just want to close quickly. For a low fee of just 1% of the loan amount, we can help with any of the situations.
We Provide Funds to Help You:
- Buy Before You Sell
- Pay Cash for a Home
- Buy without Liquidating other Investments
- Buy when a New House Needs Repairs
- Buy when Your Old House Needs Repairs
- Access Your Equity with no Seasoning Period
- Buy when on a Fixed Income or Retired
- Buy when Self-Employedwith less than 2 years of Income History
- Close Quickly
For more details on our residential bridge loans offers please visit us at: https://hurstlending.com/other-offers/residential-bridge-loans/
Benefits of Bridge Loans:
Bridge loans offer several benefits to home buyers and real estate investors. One of the primary benefits is that they provide quick access to funds. Traditional mortgage loans can take weeks or even months to close, but bridge loans can be approved and funded in as little as one week. This can be critical in competitive real estate markets where deals can be won or lost in a matter of hours.
Bridge loans can also provide flexibility in real estate transactions. They allow investors to act quickly on investment opportunities without having to wait for traditional financing to be approved. For example, an investor might use a bridge loan to purchase a property that has just hit the market and has already received several offers. The bridge loan allows the investor to make a competitive offer without having to wait for traditional financing to be approved.
Finally, bridge loans can provide financing options for investors who may not qualify for traditional mortgage loans because they are on a fixed income or are self-employed with less than 2 years of taxable income.
Examples of How to Utilize Bridge Loans:
Let’s say a home buyer comes across a property that needs modest repairs but has excellent potential. The property is on the market for $200,000, and the buyer can’t obtain a conventional loan because the master bath is part way through a remodel. Fannie Mae and Freddie Mac will not allow a buyer to purchase a home that is mid-way through a remodel even if the cost to make the repairs are minor. If the seller does not have the cash to finish the remodel prior to closing we can help. You simply apply for a bridge loan to purchase the home with our funds and then finish the bath remodel. Once the remodel is finished, we then refinance the customer into a long-term fixed-rate conventional loan.
What does it cost?
We charge a 1% fee plus other traditional closing costs to use our funds to purchase your property using a residential bridge loan.
Conclusion:
In conclusion, a residential bridge loan can be a valuable financing option for home buyers or real estate investors who need quick access to funds. It is a short-term loan that bridges the gap: (1) between the purchase of a new property and the sale of an existing property or (2) until you qualify for a conventional loan. You can also use a bridge loan for your convenience (e.g. avoid liquidating assetts at a bad time) and/or tax reasons. We provide quick access to funds, flexibility in real estate transactions, and financing options for investors who may not qualify for traditional mortgage loans.
As a residential bridge loan lender, we understand the complexities of real estate transactions and the unique financing needs of real estate investors. We offer bridge loans as well as a range of other real estate financing options. Our team of experienced mortgage advisors can help you navigate the process and find the best financing solution for your needs. Contact us today to learn more about how we can help you with your real estate financing needs.
REFERENCES
https://www.investopedia.com/terms/b/bridge-loan.asp
https://www.thebalance.com/what-is-a-bridge-loan-315645
https://www.forbes.com/advisor/mortgages/what-is-a-bridge-loan/
https://www.redfin.com/blog/what-is-a-bridge-loan-and-how-do-they-work/
https://www.bankrate.com/mortgages/what-is-a-bridge-loan/
About Jay Hurst
In addition to being one of the founders of Hurst Lending, I am also a financial planner. I have been helping our customers buy, sell, and refinance their homes since 2006. Our suite of industry-leading offers helps solve many common situations faced by homeowners and real estate investors. Have you ever experienced the frustration of trying to buy before you sell; Losing your dream home in a bidding war; Trying to obtain a No-Seasoning Cash-out loan; Being unable to get a mortgage because your new or old house needs modest repairs; or simply because you prefer using our funds to close quickly without having to liquidate other investments? Our Industry-leading suite of short-term loans solves these issues. We also offer a suite of real estate investor loan products and a full suite of conventional, VA, FHA, construction and traditional home loans.
Please feel free to contact me directly if I can help provide a loan for your next purchase or refinance, or even if you just want advice on how to get started or expand your real estate investing activities.
Jay Hurst
Co-Founder, Hurst Lending
jhurst@hurstlending.com
*Disclaimer: This article is intended for informational purposes only and does not constitute legal, financial, or professional advice. Consult with a licensed professional before making any financial or real estate decisions.
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