'Bridging' loan viability?

[medianewbie]

I have seen a property I wish to buy (it has the long term disabled facilities I need). It was built as a traditional residential house but recently used as commercial so needs permission to change back. Local council advise 'acceptable in theory'. In Scotland, it is 'offers over' £175k. I have a house valued at £275k (outstanding mortgage of 100k) . In theory I could sell & buy with no / only small additional mortgage needed: helpful as I do not have a wage (I am 57 & a Carer for my disabled YP so receive benefits only).

All would be fine except I've not marketed yet alone sold my house yet. For personal reasons I'd like to buy the other house first, to move my YP across before the stress of viewings.

Is some sort of bridging finance a pipe dream in my circumstances please?

With no income no one will give you a bridging loan, or any loan. They don't even exist in England anymore really, not sure about Scotland.

@boulevardofbrokendreamss Oh, OK thank you. I do have an income (PIP, UC etc) but it is not 'reliable' earned income (however it has just been renewed for 5 years so ironically possibly more reliable as many zero hours contracts that people struggle with)

There is also the equity in my house.

I don;t know how it works in Scotland but if you were in England you'd also have to pay the additional Stamp Duty up front and then claim it back if/when you sold your original residence.

I've been offered a loan, secured on my current house. A Company I was referrred to by a High St Mortgage broker (Co is 'Brightstar')
The interest is 1% p/m, for 12m, then 3% p/m. I think it's too scary sadly.

Check out loan.co.uk. We’ve just got a bridging loan agreed through them at better rates than what you’ve been offered. They found by far the best deals (spoke to a few brokers). They’ve got great reviews on trustpilot and so far, my experience has also been great. Nothing to lose by giving them a call. Good luck and let us know how you get on! 🤞🏻

I’ve bridged twice, so they definitely do still exist. But in both cases I needed the income to underwrite the full total loan amount and at least 50% equity. No reputable lender is going to loan you £275k with £175k equity and only benefits as income. Brightstar is a sub prime lender and you’d be mad to take their offer, the interest would be £1750 a month in the first year rising to £5250 a month in year . Can you afford that?

You have misunderstood- the OP’s current property is worth 275k , which she has 100k mortgage left to pay, and the property she wants to buy is 170k.

No, I understood that. It means that the total loans outstanding before the first house is sold would be 275, 100 on the existing mortgage and 175 to buy the new house. With only 175 equity, a LtV of over 50% and no income. Like I said, no reputable lender would take on that risk. My interest calculation was just in the Brightstar piece and would be on top of the existing mortgage.

Why would OP be borrowing the 100k outstanding on her mortgage? The point of the bridging loan is to borrow the 170k for the new property- that’s why it’s a bridging loan and not a re mortgage.

I've decided I am not going to go down that route. Thanks for comments x

Cats, until she is sold, the bridging loan is on top of the existing, outstanding mortgage.