Unlock equity before sale

Selling your current home while buying a new home is like a balancing act. Scheduling the right timing for sale and purchases, especially in competitive markets like Sacramento, California, can be a stressful cause.

When stocks are low and prices are high, it seems that your only option is to sell your current home and move to a temporary place when looking for a home forever. But who wants to move twice? Thankfully, there is another option.

A bridge loan may be exactly what you need to buy your next home without waiting to sell it. This short-term financing option gives you flexibility and control over the schedule. In this guide, we will take you through everything you need to have a Sacramento Bridge loan.

What is a simple bridge loan?

Bridge loans are a short-term financing option that can help you buy a new home in your current market. It can take advantage of the equity you have established in your existing property, allowing you to quickly get cash or close fees on your next purchase.

While bridge loans are often more costly than traditional mortgages, many Sacramento buyers find it worth avoiding the flexibility of a hurry sale or temporary housing.

Bridge loans are sometimes called:

• Bridge financing
• Bridge Loan
• Temporary financing
• Gap financing
• Swing loan

How does bridge loans work in Sacramento?

In Sacramento, bridge loans are common when you find the perfect new home, but your current loan is not yet sold. With Bridge Loans, you can use equity in your existing home to help with down payments and closure fees for your new property.

Typically, the same lender handling a new mortgage can also offer a bridge loan. Most will require that your current home be actively sold, with loan term usually ranging from six months to one year.

Your lender can use existing mortgages, new mortgage payments, and interest-only payments to assess your debt-to-income ratio. However, if your current home is already in a contract and the buyer has received final loan approval, the lender can only consider your new mortgage payment – providing more breathing rooms in your financial calculations.

What are the benefits of bridge loans in Sacramento?

Here are a few ways Sacramento’s Bridge Loan can make your move smoother:

• You can propose a non-levy offer: Sellers usually prefer buyers who have no unexpected home sale incidents.
• You only need to move once: Skip the hassle and additional temporary housing or storage fees.
• You can prepare your hometown: Move out first and focus on preparing your home for stage and repair.
• Some lenders do not need to pay during the loan period: You may not owe anything until your previous home is sold.
• You can move quickly in the right home: Make an offer without worrying about selling it first.

What are the disadvantages of bridge loans?

While bridge loans can bring you greater flexibility and relieve stress in buying and selling actions, there are some drawbacks to consider:

• Additional loan fees: You can pay for coverage, origin fees and other settlement fees.
• Additional financial stress: You may be responsible for paying two mortgages and one bridge loan at the same time.
• Qualifications may be more complicated: Lenders are usually more stringent than traditional mortgages.
• Underwriting may be slow: The audit process may need to be more than expected.

When is a bridge a good solution?

Bridge loans may not be suitable for every real estate situation, but in the right situation, it can help simplify the transition from one home to another. For those who buy and sell at the same time, Bridge loans in Sacramento can provide valuable solutions.

Here are some cases where one of the conditions may make sense:

• You need to get the interest in the down payment of your new home from your current home.
• You can’t afford to move twice between a sale and a purchase.
• Your dream home has just been on the market and you want to jump on the opportunity before it disappears.
• Your quoted home sale accident is a deal breaker for the seller.
• You can’t prepare or sell a house on the stage while still living there, and you need to vacate it first.