What is a bridging loan: A bridging loan is also known as ‘gap financing’ because, as the name suggests, it has more to do with filling or channeling the empty cracks in your financial condition, especially when it comes to an emergency monetary need or crisis you are facing. , be it in terms of purchase of personal property or be it with regard to commercial issues. This loan has become very popular with the mob of real estate owners or businessmen despite the high interest rates that come as baggage. When you are in great need of monetary support and that too within a restriction of a few weeks before down payment or any other needs, then a loan is the only option because this loan can be made available in a comparatively shorter period of time. with a minimum number of documents submitted for verification and review before the loan is granted. It is a short-term provisional loan, since it only lasts up to one year.

Examples of real life where loans can help: Let’s take a hypothetical case where you are looking for a new apartment or a two-story house, depending on your needs, requirements and unavoidable requirement. The difficulty is that you need to sell your current home to buy a new one and your broker has given up and you just can’t find the right buyer. Here in this situation where you are facing time constraint for prepayment and you are in urgent need of that amount, bridging loan becomes very helpful despite exorbitant interest rates. Unless and until you find a permanent solution to pay off the mortgage, as well as make the down payment to get a better deal on the housing development, the bridge loan or interim financing is the only way you can act confidently. guarantee of proper execution. of your plans with minimal official hassle.

Taking into account the previous example, why is it said that taking a bridging loan is very flexible:

• The terms of the loan state that if you are unable to sell the house within six months, you must pay the interest rate on the loan back.

• If you can find a suitable buyer within the six month period, then you will not have to pay back the loan with the interest rates due.

• Bridging the gap created by the struggle of time between buying and selling, this loan solves all your financial situations.

What is the eligibility criteria to apply for the bridging loan: The lender will do a credibility check on your loan history and anything that shows you are not loan-worthy. You will have to pledge any collateral or real estate assets. Also, bridging loans are often offered by individual lenders and not by any one bank.