Blog The McNelly Team's Step-by-Step Guide to Securing Bridge Loans Oct 25, 2024

Are you in the market for a new home but haven't sold your current one yet? Or perhaps you've found your dream home but have yet to secure a buyer for your existing property? In situations like these, bridge loans can be a valuable financial tool to help bridge the gap between the sale of your current home and the purchase of a new one. At The McNelly Team - Fairway Independent Mortgage, we understand the importance of securing the right bridge loan for your unique situation. That's why we've put together this step-by-step guide to help you navigate the process with confidence.

Step 1: Understand What a Bridge Loan Is Before diving into the process of securing a bridge loan, it's important to understand what it is and how it works. A bridge loan is a short-term loan that allows you to access the equity in your current home to finance the purchase of a new home. Bridge loans typically have higher interest rates and shorter loan terms than traditional mortgages, but they can be a valuable tool for homebuyers in certain situations.

Step 2: Determine If You Qualify To qualify for a bridge loan, you will need to meet certain criteria set by the lender. These criteria may include a minimum credit score, a maximum loan-to-value ratio, and a strong financial profile. The McNelly Team can help you assess your eligibility for a bridge loan and guide you through the application process.

Step 3: Calculate Your Loan Amount Once you've determined that you qualify for a bridge loan, the next step is to calculate the amount of money you will need to borrow. This will depend on the equity in your current home, the purchase price of your new home, and any closing costs or fees associated with the loan.

Step 4: Gather Required Documentation Like any other loan, bridge loans require a certain amount of documentation to support your application. This may include proof of income, tax returns, bank statements, and information about your current and future homes. The McNelly Team can help you gather all the necessary documentation and ensure that your application is complete.

Step 5: Submit Your Application Once you have all your documentation in order, it's time to submit your application for a bridge loan. The McNelly Team will work with you to submit your application to the lender and advocate on your behalf throughout the approval process.

Step 6: Close on Your Loan If your application is approved, the final step is to close on your bridge loan. This typically involves signing a series of documents and paying any closing costs or fees associated with the loan. Once the loan is closed, you can access the funds to purchase your new home.

Securing a bridge loan may seem like a daunting process, but with the right guidance and expertise, it can be a smooth and efficient experience. The McNelly Team - Fairway Independent Mortgage is here to support you every step of the way and help you secure the right bridge loan for your unique situation. Contact us today to learn more about our bridge loan services and take the first step towards your dream home.