Showing posts with label bridge loan. Show all posts
Showing posts with label bridge loan. Show all posts

Wednesday, September 18, 2013

So You Want to Be a Self-Taught Home Seller?

Summer is your best bet if you’re on the fence about when to sell something prospective buyers would have to travel to see - case in point: your house. It’s during these months that your open house will get the most foot traffic, more so than later in the year, so, yes, your vacation plans will have to wait. But you knew all that, seeing that you’re planning on going it alone and striking it big with the sell, right? In case you’re not sure whether this renegade free-agent path is the right fit for you, here are some pointers that can shed some light along the way to closing the deal and will ideally help make up your mind.

Make Sure You Crunch the Numbers

Putting your house on the market, being as important a decision as it is, also usually comes with huge, paralyzing jitters, which is why most people prefer to use a real-estate agent. Alternatively, some choose to take the road less traveled, which, if done right, might be more rewarding, financially speaking - at the end of the day you’ll be just as well pocketing the 6% from the sale that would have otherwise gone to the agent. To make the leap from wishing it so to actually getting your wish, the first thing you’ll need to do is zoom in on the exact sum you’re expecting to get from the sale.

  • If you intend on using the money from the sale for the purchase of a new home, do your homework on what your current home should fetch you in order to achieve that switch. You can use online tools to calculate the mortgage rate on the house you have in your sights, then apply for a bridge loan, against the equity in your current dwelling, for the downpayment.
  • In order to list your house on the Multiple Listing Service, you’ll need to come up with the right asking price, which you should set 1) in accordance with the price tags on some other houses in the area which you’ve previously checked, and 2) a tad higher than the sum you have in mind - this will leave some wiggle room for negotiations. Remember that, while not using an agent will definitely save you money, the buyer’s agent commission will still shave some off the final bounty. 

Roll Up Your Sleeves for Some Heavy Lifting

Aside from the legwork entailed by comparing and contrasting your house with others in the neighborhood, which will give you a better idea of what yours is worth, there are other small details to consider - and, all counted, these will demand some effort on your part.

  • Advertise the right way - the For Sale sign is one of the best “weapons” at your disposal, as it’s putting out there the asking price and contact details, in plain sight for every prospective buyer or agent to lock on to. Buyer’s agents will also pounce on the opportunity of a commission if you hint at it with a well-worded, brief invitation on the sign. 
  • Your arsenal should also include quality photos of both the exterior and the interior of your house - you can use these for your flyers and / or post them on real-estate websites. Instead of relying on old snapshots, take new ones, using a top-notch camera, and only show the best, most current version of your home. Before playing the shutterbug, get your house spick and span, with all the clutter either removed or relocated around the existing space for a better, more attractive use of it, with an eye to showing the place in just the right light.

All that’s left for you to do at this point is get ready for visits - but not before insuring your house, in case of any mishap - and brush up on your knowledge of the law, as, like with any purchase of this magnitude, you’ll be required to sign some papers that you won’t want to just leaf through. Take your time, get a handle on the situation and some understanding of the market, and you’ll not only reach your goal, but also that feeling of fulfillment that comes from knowing you made it happen yourself.

Thursday, July 25, 2013

Positive Attributes of Bridge Loans

Bridge loans are common types of loans used in the domestic, commercial as well as industrial sectors. The loan is usually a short term loan that is taken out pending an approval of a larger loan or closing a transaction hence the proceeds from the main loan or cash gains will be used to offset the short term loan. Typical names for bridge loans include swing loans or caveat loans which range in time periods of between 2 weeks to as long as 3 years. These loans will usually feature higher market interest rates as compared to ordinary loans. Notable benefits of the swing loans include the following:

Real Estate Deposit

Bridge loans are quite common in the real estate sector where a potential buyer will acquire the loan to put as deposit for the house and when the realtor manages to resell the house, the proceeds from the sale are used to offset the loan. Overtime a real estate agent will be able to built credit worthiness and will occasionally use the loans in most of his transactions.

Foreclosure Deals

A homeowner facing financial constraints such as risking losing a property will source for a caveat loan to remodel the house and upon selling the property; he will pay back the loan. The homeowner may also use the loan as a deposit for a cheaper property as he waits for the main property to be sold.

Construction Industry

Developers will also obtain bridge loans during the initial stages of construction when a property is yet to fully takeoff awaiting permit approval. Upon meeting all the requirements, the constructor will acquire a construction loan which will be used to offset the short term loan.

Continuity in Business

A delay in payment will also lead to a business to acquire the short term loan in order for the business to run smoothly as they await the pending payments. A business will also use bridge loans to fund an acquisition while waiting for the final settlements to be drafted and affected. 

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