Bridging Loan.

Bridging loans are mortgage-related. Sometimes, when purchasing a new home, the seller requires to complete the purchase before the funds from your buyer are not there yet. This type of situation requires a bridging loan. This is a short-term loan that covers the amount you require to complete the purchase on your new home. This ranges from £25,000 upwards.

When the sale of your old home is complete, the funds from that repay the bridging loan. A bridging loan can be borrowed from a few weeks upto six months. Usually the interest rate is quite high in this type of loan, but this is to compensate for the short-time period of the loan.

This is often the only option for many people as otherwise they could lose out on their new home.