Exploring the Options
You are thinking of buying another property but, without the
proceeds from the sale of your existing property, you can't
afford to buy a new one.
A bridging loan is the answer because it enables you to finance
the purchase of your new home prior to selling your existing
property. It is also useful for borrowers who want to finance
the construction costs of a new home while still living in
the old one.
Different lenders have different policies with some lenders
allowing you to capitalise interest to your loan until you
sell. Planning is the key to a successful transition. This
would also be a good time to review your current loan and
examine the options available to you.
Some other questions to think of are:
Will I need to increase my loan?
If the cost of your new property including purchase costs is
higher than your existing loan facility, you will need to consider
paying the difference yourself or increasing your loan. I can
help you work out how much you will need to borrow
Costs may include fees for discharging your current loan if
it’s not portable, break costs, establishment and valuation
fees for the new purchase, government stamp duties on the new
property, building inspections, moving costs and other fees
or charges payable to your old or new lender. Using my service
I will be able to assist you work out the costs so that your
decision is an informed one.
Is my current loan portable?
Not all loan products or lenders will offer this feature. You
will need to check your Loan Agreement to see if you can “substitute
security”. I can make these enquiries on your behalf if
you are uncertain or unable to find the answers.
I move or renovate?
The two most important factors for most people are: cost
to move to a better property and avoid the inconvenience of
renovations and weighing up the advantages and disadvantages
of moving to another suburb. Download a copy Renovate
vs Move checklist to give you a handy reference.
If you do decide to move, download a copy of my Moving