Is mortgages bridge
Is mortgages bridge
The mortgage bridge is to financial product that there offer the banks and savings banks that it allows to chang of housing without need to sell promptly the house that is had at present. It is to mortgage that is granted by the characteristic of being to temporary financing, generally one year or two. It will be the steals of the one that will prepare to sell the previous housing and formalize the new mortgage on the new house. Theoretically this period must serve to obtain the best possible conditions in the goes out of the previous housing, conditions that would not obtain if it was necessary to sell quickly to be able to acquire the new house that is wished or it is necessary to acquire promptly.
If it is wished or it is necessary to acquire to new short-term housing, it is really difficult to synchronize the steal of the acquisition of the new housing with the it goes out of the previous one. It is not desirable to sell helter-skelter, so of course the building will be undersold at to price lower than the real one of the commercial value and on the other hand normally it is not possible to face to two quotas that I have would suppose having two mortgages. With these conditions we would be speaking about the mortgage bridge, to formulates to finance the change of housing, which would allow us to acquire the new house selling calmly the previous one and paying the only quota. The conditions will change from one banking institution to other one. There plows also intermediary financiers who will offer his individual conditions for the financing of the change of housing. So that the quota to pay does not differ excessively between the mortgage of the housing that we want to sell and the mortgage bridge, there brings in the game the concept period of lack, which normally consists of only paying interests during the period established for the mortgage bridge, one or two years. To understand better these concepts let's see to fictitious example. For better comprehension of the concept of the mortgage bridge we will omit the expenses derived from the different operations.
Fictitious example of mortgage bridge:
1. - To family lives at present in to house at to price of market for 180.000 euros. Cardinal Is is paying the mortgage of this house to himself and the hanging is 120.000 euros for the one that pays to monthly quota for 700 euros to himself.
2. - Personnel For circumstances they plows going to change housing. The house in which 250.000 euros want to live through slope.
3. - They eats to his banking institution where they formalize to mortgage bridge that amounts to 370.000 euros, which would correspond to the sum of 120.000 euros that they have left hanging on the mortgage of the first apartment resides 250.000 euros that the new housing costs.
4. - With 120.000 euros of the mortgage bridge would storm door the ancient mortgage.
5. - It is not desirable to pay an excessive quota, which turns aside of 700 euros that they were paying for the first mortgage. The mortgage bridge includes the formulates of the period of lack, for which during the established period, one or two years, only the interests will be paid.
6. - They will have this steals to look for the best conditions for the it goes out of his previous apartment. Ideal The conditions plows to sell it for 180.000 euros that it was the market price. 180.000 euros obtained with the it goes out will be used to you reduce the price of the mortgage, which was amounting to 370.000 euros, but now, reducing the I value of the salted, it would remain in 190.000 euros.
370.000 euros of the mortgage bridge - 180.000 euros of the salt of the ancient apartment = 190.000 euros for the new mortgage.
7. - Now they will pay the finished quota, that is to say, cardinal and interests, of the mortgage of the new housing. Cardinal The hanging you have diminished greatly thanks to the it goes out of the previous housing.
Another related concept is that of credit bridge. One usually uses East when the future housing is still on plans and therefore it is not possible to mortgage the new housing because it is not constructed yet. The credits bridge would include periods of lack, which they will allow us to face the initial expenses that there demands the promoter (entry, quotas or initial notice...).