Bridging Loan to allow the purchase of one house whilst waiting for a sale on current house

LKAY

Hello!  Does anyone have any recent experience or advice on bridging loans, please?  We’re looking to buy a property (£280k) but need to sell ours first (£145k) and we only have £200k in savings, thus we are reliant on selling to make up the shortfall. Viewings across the board in our area seem to have slowed right down so we are considering a bridging loan (£80k) to allow us to proceed to purchase and will pay it back once ours sells in “a few months” time.  I cannot find out any information (e.g. interest rates, fees, procedure to apply etc) on any bridging loan products without having to register my details online with various companies. I was hoping to be able to do a comparison on a comparison site and get a rough idea of what it will cost, but they all want me to register my details for a call back or arrange an online meeting. Any information, advice or recommendations gratefully received. Or any alternative solutions which we haven't considered also highly welcomed!

rexmedorum

LKAY said:

Hello!  Does anyone have any recent experience or advice on bridging loans, please?  We’re looking to buy a property (£280k) but need to sell ours first (£145k) and we only have £200k in savings, thus we are reliant on selling to make up the shortfall. Viewings across the board in our area seem to have slowed right down so we are considering a bridging loan (£80k) to allow us to proceed to purchase and will pay it back once ours sells in “a few months” time.  I cannot find out any information (e.g. interest rates, fees, procedure to apply etc) on any bridging loan products without having to register my details online with various companies. I was hoping to be able to do a comparison on a comparison site and get a rough idea of what it will cost, but they all want me to register my details for a call back or arrange an online meeting. Any information, advice or recommendations gratefully received. Or any alternative solutions which we haven't considered also highly welcomed!

can't you get a regular mortgage, with a short fixed-term and pay it off once the term ends (assuming the other house has sold by then)?

Countrysider

I'm actually in a similar situation as you. I want a short term loan option of around £50K to bring my savings up to the cash purchase price, but actual short term loans explicitly prohibit being used for property purchases. I assume they want you to go down the secured mortgage route for that.  

Someone else on here suggested using credit cards as a purchase to the conveyancer if they'd accept this. That might get you some of the way but you'd likely not get an £80K limit even across a few cards. Like you I also looked at bridging loan companies and, also like you, got annoyed that i couldn't just compare prices and terms.  

Sorry i don't have any advice but i'll watch this thread with interest. 

[Deleted User]

LKAY said:

Hello!  Does anyone have any recent experience or advice on bridging loans, please?  We’re looking to buy a property (£280k) but need to sell ours first (£145k) and we only have £200k in savings, thus we are reliant on selling to make up the shortfall. Viewings across the board in our area seem to have slowed right down so we are considering a bridging loan (£80k) to allow us to proceed to purchase and will pay it back once ours sells in “a few months” time.  I cannot find out any information (e.g. interest rates, fees, procedure to apply etc) on any bridging loan products without having to register my details online with various companies. I was hoping to be able to do a comparison on a comparison site and get a rough idea of what it will cost, but they all want me to register my details for a call back or arrange an online meeting. Any information, advice or recommendations gratefully received. Or any alternative solutions which we haven't considered also highly welcomed!

just sent one off in similar situation. The indicative terms are as below.  You can change the figures to get your own numbers more accurate.  :

Net Loan:	£120,000.00		Repayment Guide
Monthly Interest Rate	0.49%		Month	To be repaid
Term (months)	12		1	£123,435.33
Facility fee rate	2.00%		2	£124,039.60
Fees added to the loan;			3	£124,646.84
Facility Fee	£2,400.00		4	£125,257.05
Assessment fee	£295		5	£125,870.25
TT Fee	£25		6	£126,486.46
Broker Fee	£0		7	£127,105.68
Total Fees (added)	£2,720.00		8	£127,727.94
Redemption Fee	£114		9	£128,353.25
Upfront costs;			10	£128,981.62
Valuation fee	Free desktop		11	£129,613.07
Dual Rep Legals	£720		12	£130,247.62
Packager fee	£195	No Early Repayment Charge

london21

Do you know for certain how many months you will need the Bridging loan for because they can be expensive like 0.5% per month. 

rexmedorum

would it be possible to get a a regular mortgage and pay it off when the other house sells (and after any fiexed period)?

Also: you may well be hit with the higher rate of stamp duty when buying your "second" home. You can claim it back when the other property sells (assuming that's within 3 years) but even so.