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Anyone used a bridging loan when buying a house?!

6 replies

madmumNika · 13/02/2008 21:02

Like so many at the moment our house has been on the market for nearly 7 months and we are desperate to move. It's in a desirable area etc. and we did have an offer back in Oct but at the time the estate agent thought we could get more and so we "held out"- only for everything to slow down! We really want to move before the summer and have seen a house we'd put an offer on if we'd had an offer on ours, but as that's not yet the case a friend mentioned how about getting a bridging loan. Has anyone used these before? Is it worth it? Thanks xx

OP posts:
horsemadgal · 13/02/2008 21:06

It's really only a short term solution. I doubt the banks would be keen to do it unless there was a firm offer on your house anyway.
We had a 2 month overlap and had a second mortgage instead of a bridging loan. It worked out cheaper for us as we weren't charged as much fees.
Best speak to your bank though to get a better idea of costs, charges etc.

lalalonglegs · 14/02/2008 10:17

Don't get a bridging loan unless you have a very real offer on yours - it is one of the most common ways that people came unstuck during the 1990s recession. Fortunately, in current climate, you are unlikely to get one. If you have lots of equity in your original house have you thought about this thread?

chopchopbusybusy · 14/02/2008 10:34

No, just don't do it. If you are really desperate to move then reduce your asking price - it will be cheaper in the end.

Artichokes · 14/02/2008 10:39

There is no way I would consider a bridging loan in the current economic climate. Nobody knows what is happening to the housing market. You house could take months and months to sell, it could sell way below the asking price, meanwhile interest rates could rise or one of you could lose your job.

Hopefully none of that will happen but please, please don't consider a bridging loan. They are risky and expensive at the best of times.

madmumNika · 14/02/2008 11:18

Thank you. This is what I suspected. We own our current home outright so perhaps mortgaging it to release some equity to use as a deposit on the house we'd like to buy is the way to go.... But we are only on one income currently so two mortgages sound a bit scary, even if we manage to rent out our current house... Will bite the bullet and either just wait or ask about reducing our asking price (estate agent reticent to do this). Will talk to our financial advisor too.

OP posts:
hanaflower · 14/02/2008 11:30

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