A bridge loan is just that. That is, it bridges the time between your real and acute need for money, typically to prevent foreclosure, and the time you are going to get financing. The money from the consequent financing source is then used to repay the loan.
The world of real estate financing has been the most common consumer of bridge loans. Here the loan is used the means for tiding over on the mortgage of a new home while the previous one is either currently in the process of being sold, or still not put up on the market for sale.
There might be an opportunity that you might not want to miss out on. This is where a bridge loan becomes helpful. Additionally preventing a foreclosure is a common use too.
Bridge loans are of great help to those who are in urgent need of funds to close on a new residence so that the current home can also close on the contract of sale. This requirement is usually the main reason why most people avail of the bridge loan. There are two types of this kind of loan: closed loans are for those whose contract for the sale of the property have been signed, and have pushed through.
Since the sale is already concluded the lending...
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