Question:

What are secured bridge loans?

Answer:

What secured bridge loans are is simply loans secured by some property. Either the property to sell, or the property to buy is used to secure the loan.

Many people would go out and sign for a new home and a new mortgage and then they would find out that their old home wouldn't sell as quickly as they thought it would. At that point, they have signed an agreement and made a down payment and now they cannot sell their house. If they back off, they will lose the down payment and all the costs related with buying a new home - together, this may range from 5 to 20 percent of the house value.

This is when a secured bridge loan kicks in. The bridge loan can be secured on the new or the old property, and the lender will like to know that the buyer has enough money to carry on payments for two mortgages and a bridge loan for a while until the current property sells.

Some lenders say that using secured bridge loans is essentially difficult to cope with for long, as you are paying three loans on two properties.

Mortgage rates hit their lowest since 1955. Ask the home loan experts we recommend Quicken Loans how to take advantage of them.
Was this Mortgage QnA helpful?
Not at all
  • Currently 2.9/5 Stars
  • 1
  • 2
  • 3
  • 4
  • 5
Definitely
Add to this Answer

Mortgage QnA is not a common forum. We have special rules:

  • Post no questions here. To ask a question, click the Ask a Question link
  • We will not publish answers that include any form of advertising
  • Add your answer only if it will contrubute to the quality of this Mortgage QnA and help future readers
If you have trouble reading the code, click on the code itself to generate a new random code. Verification Code Above:
Bookmark and share this QnA: