Getting into a new home with a bridge mortgage is easy, but what are they and how do they work? Just like with every other kind of mortgage, you’re going to want to talk with one of our Toronto mortgage brokers to make sure that what you’re doing makes financial sense for you! We work for you, not for the banks; you’ll always have someone on your side to help you make sure you’re getting the best deal on your bridge mortgage. Here we’re going to go over how bridge mortgages work, so let’s get started!
What is a Bridge Mortgage?
A bridge mortgage helps you bridge the gap in your financing when buying a home; it’s important to note that you will have to be in the process of selling your home while trying to build a new one. You can’t try and buy a new home that’s outside of your price range if you don’t have another home for sale. That’s why it’s called a bridge, but it should be thought of as more of a trampoline. It’ll give you enough time to bounce to get your previous home sold. You’re going to want to work with one of our Toronto mortgage brokers to make sure that a bridge mortgage is right for you.
Can a Bridge Mortgage Help You?
With a bridge mortgage you’ll be able to get into a house that you couldn’t have otherwise, but they’re not right for everyone. You’ll want to speak with a professional who can help you objectively evaluate your situation to make sure that you’re doing the right thing. Sometimes a bridge mortgage can hurt your situation more than it could help, and you may just want to find a different lender that will give you the money you need outright. There are so many different ways to fund a home buy and sale, it’s important that you explore all of your options before you settle on just one.
What Should You Choose?
Every situation is different, so you’ll need to talk to a professional to make sure that you’re getting the right information. Your lender may be offering you a bridge mortgage right now, but how do you know it’s the right one? What’s the lifetime cap, what’s the interest rate, what kinds of penalties are attached to the mortgage? What happens if you’re not able to sell your home in one month, three months, six months? You have to know the answers to the questions before you even consider signing on.
When you work with one of our Toronto mortgage brokers, you’ll be able to find out exactly what you need to do to meet your financing gap. Sometimes you’ll need a bridge loan, other times you may need to just find a better lender who can offer you more money and help you avoid the problems of a bridge mortgage.