A bridge loan is regarded as the loan-anticipatory loan. Generally, people apply for this kind of loan to meet their emergency monetary requirement while waiting for a bigger loan to come through. So, it doesn’t need much time to get approved, which is its biggest advantage. Furthermore, the tenure of this loan is for a short period of time. Other notable advantages of this kind of loan are mentioned below:
- It can meet your both residential and business purpose The amount you receive as the bridge loan can be utilized for any kind of residential purposes be it for purchasing or renovating the residence. Apart from this, it is especially handy for businessmen who can move forward their business with the sudden inflow of capital. It helps in launching new services and new products without any delay and that too in an appropriate time.
- It saves time It has been noticed that the bridge loan doesn’t require much time to get approved. This is because it has been designed to offer the monetary requirement to the people in the case of an emergency. To be approved for a bridge loan, you have to deposit your assets to the finance company as security. For this, you can deposit any home or any personal asset which has a net value equal to the amount you are taking as the loan. It is another reason why this loan gets approved within a short span of time.
- It assists in buying and selling the property A bridge loan offers optimal support in selling and purchasing the property. If you need to purchase any new property by selling the old one, you don’t have to wait for long. This loan facilitates you to buy the new property by obtaining 80% cost of the existing property. The finance companies and lenders will ask you to deposit the existing property as the security of the loan. You can use some percentages of the loan amount as the down payment of the new property too.
- It takes varied properties as security The bridge loan is the only loan which takes varied properties’ documents as security. Furthermore, you can deposit either one or a combination of multiple assets for the security of the loan. It can be your home, car, or any other personal assets like gold bars and certificates. Make sure that the secured assets are convertible into liquid cash in the case of any default on the loan repayment.
- The loan can be taken for the construction of non-standard property There are a number of finance companies and mortgage providers who offer a loan on the standard properties and assets only. But bridge loans are applicable for all types of non-standard as well as standard properties.
- It possesses flexible lending eligibility criteria Most of the loans and the finance companies have their own decorum to provide the loan to someone and their eligibility criteria are also hard to attain. Among all kinds of loan, bridge loans possess the most flexible eligibility criteria.
Owing to its nature and function, these loans are simple and the easiest to attain. Moreover, the criterion to avail it is not based on credit history, affordability, and income which are common factors for all other kinds of loan.
