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Can Clients Get a Bridging Loan with No Deposit?
Bridge financing is not the same as a mortgage. Both require application and threshold requirements, but they’re not the same. A mortgage requires a 20% deposit upfront. In cases where the deposit is not available, applicants are asked to provide alternative solutions, such as a guarantor, collateral or to pay a lender’s mortgage insurance fee.
Some applicants face providing a bridging loan deposit. If they cannot, they incur the insurance fee imposed by the lender. Keep in mind that there are several moving parts for bridging finance.
Bridging finance helps the current homeowner who intends to purchase a new home even though they still own another property. They intend to sell the current property and move into the new one. Many homeowners have completed this process successfully, so it can be done. The lender is looking out for the homeowner by being conservative and thorough.
If the client places their home as security for the bridge loan, they may not incur the insurance fee. If the client’s current home possesses enough home equity, the insurance fee may be waived. It truly depends on the outcome of the application process. Nonetheless, brokers can have confidence that Mortgage Street loan specialists give every application the attention it deserves.
Our loan specialists have access to innovative tools that assess the client’s current financial situation. If one financial product isn’t a good fit, other financial products may fit the situation better and deliver better results.
Bridging Loan Deposit Conclusion
Some clients will be asked to provide a bridging loan deposit. If the deposit is not available, they’ll be charged a lender’s mortgage insurance fee. Ultimately, the application process, the property value, and available home equity determine the overall loan package. Our Mortgage Street loan specialists provide several options and alternative solutions. For more information, contact our team.