The bridge loan or purchase-resale loan is a short term loan allowing people who are already owners to acquire a new property before the sale of the first.
This type of loan allows you to enjoy a buying opportunity while taking the time to sell the current property in the best market conditions
The dry relay loan
It is granted when the price of the new property to be acquired is less than or equal to approximately 70% of the price of the property offered for sale, net of credits. This formula is a financial advance, the loan must be repaid in full as soon as the sale is concluded. Early repayment will be free of charge.
The bridge loan accompanied by a mortgage
In the case where the bridge loan is not sufficient to finance the new property, the borrower must also pay a mortgage.
Until the sale of the first asset is effective, the borrower must repay the loan interest on the bridge loan (the payment of which may, however, be deferred for resale), in addition to the conventional home loan.
This can therefore be added to existing loans on the property for sale, unless the bank has agreed to refinance them through the project financing, which offers better control of the maturities.
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Who can benefit from a bridge loan?
This loan is available to anyone who owns a property for sale.
This property can be held in own property or through an SCI (only in case it is the same SCI that buys the new property)
What is the amount and duration of a bridge loan?
The amount of the bridge loan is calculated based on the value of the property offered for sale. Banks give, on average, 70% of the estimated price.
The duration is short, usually 1 year renewable once
However, this loan is not possible if its value, supplemented by the contribution, is less than the remaining capital due from the current credits on the property to be sold.
What are the advantages of the bridge loan?
The bridge loan provides funds to quickly acquire a new property without waiting for the sale of the old. This formula avoids renting during the transition period.
Discover the different types of home loans
- MORTGAGE LIFE LENDING LOAN
- LOAN IN FINE
- THE MORTGAGE LOAN