What Are Bridging Loans And What Are Their Benefits

What are bridging loans and why do people take them out? How do they work and how do you apply for one, and what are the benefits of bridging loans? Before you apply for this type of financing, let’s discuss what they are in greater detail.

bridging loan example

What is Bridging Finance


They are a type of loan that is secured by the home you currently own. The purpose of bridging loans are to bridge the gap between a homeowner’s new mortgage and the sales price of a new home, if the current home isn’t sold before closing. What you’re essentially doing is taking out a loan as a down payment for your new home, while waiting for the closing to be completed on your new home.

It is temporary financing until you can secure permanent financing for your new home. There are many lenders that offer bridge loans. Bear in mind that different lenders have different criteria for borrowers to meet.

How To Apply for Bridge Loans


Applying for a bridge loan is easy, as all you do is find a lender that provides the loans. You fill out an application, submit it with any requested documents and then wait to see if you’re approved. If any additional info is needed, the lender will let you know, otherwise they will eventually inform you that you were approved or denied for a bridge loan.

The Benefits


One of the best things about bridge loans is they can be used for various situations that require creative solutions, such as distressed borrowing and closings that are of time-of-the-essence. They are also ideal for those with credit issues or bankruptcy issues. If you need a solution when selling your home and it hasn’t closed yet, and you have a new home in mind, then a bridge loan might be for you.

Another benefit of bridge loans is how fast they can be acquired. They close very fast. Generally speaking, closings occur within 30 days, but they can close in as little as 15 days.

Another benefit is the prepayment options available. In many cases, you won’t have to pay a penalty if you decide to pay the bridge loan off earlier than planned. Whether you’re a company or a homeowner, a bridge loan is flexible when it comes to prepaying them back.

Finally, just like any other kind of loan, there are various amounts you can apply for. What you’ll be approved for depends on various factors, but generally speaking you can be approved for thousands, but some lenders are only willing to lend up to a certain amount. We suggest applying for what you need with a few lenders and wait to find out which one/ones approve you for a loan, and then accept the one that offers you the best rate and the best payment plan.

Now you know what are bridging loans and what their benefits are, as well as how to apply. However, make sure you carefully weigh the pros and cons before applying for a bridging loan. Good luck if you decide to apply for one.

Why Is Cryptocurrency Experiencing Such A Dip In Value?

The baseline for every currency is the of the sum total of a county’s holdings. Many that was in gold but the gold standard has now fallen by the wayside. At least for most countries in the world. However, normal currencies – such as you and I use has become rapidly a source of dissatisfaction. For many people the work the networks of financial institutions and their relationships with government frankly makes people uneasy.

So at some point the dam had to break- there had to be a better way to encourage financial transactions – was there a way for people to exchange value – without being subject to the terrible costs of using the traditional financial system?

The answer came in the form of cyptocurrency. A limited amount of currency that would allow those who wanted to swap their fiat current for something a bit more ephemeral. A currency that was based on encrypted data.

It was a hit. Many people, for many difference reasons that that cvryptocurrency woould take their lives onto to a whole a whole new level. It promised freedom. You could but a Ferrari if you wanted – using a currency that was not attached to any government – nor a global financial institution.

But something went terribly wrong. It seemed that the Grandfather of crypto was not as invulnerable as it seemed. Bit differed an implosion that made emerging market economies seem robust by comparison. It simply fell of a cliff Bitcoin lost 60% of its value in 2018. For a virtual currency that took the world by storm a a valuation of $1500 per bit was a fall from grace. When one considers that a Bitcoin would have minted you $20,000 in 2017 the drop is enormous.

But why? Why would the darling of not only private investors but also institutional investors simply hit the doldrums? It is incredibly puzzling – market economics seemed have gone mad. Bitcoin is limited in circulation – that is one of its attractions – the inventor did it purposefully. Once the mine of Bitcoins is gone – it’s gone, the algorithm that manufactures them simply does not allow for any more to be made. So scarcity should make them more valuable. It didn’t happen that way.

Today the slide into oblivion bu cryptocurrency has been surrounded by confusion. The Blockchain system that guarantees anonymity and stands at the foundation of currency stand in danger of crumbling – the anonymity of these currencies seem to be under attack from a a variety of sources.

So why did things like this happen? Firstly it was human error. Buying Bitcoin (as an example) was lucrative. Sell high, buy low. But unfortunately there is only so much market demand under this model. eventually someone runs out of money – and that was the buyers who leaped into the Bitcoin storm.

Secondly there were the manufacturers of high powered chips that allowed those who wanted to mine Cryptocurrency to make a living. Both AMD and Nvidia decided that there focus was elsewhere. With the withdrawal of these two companies that vital support for mining which provided new coins was removed. One would have though that the lack of new coins would increase demand – it simply did not.

cryptocurrency

At the same time the tech market in the U.S. was hot by the perfect storm – a falling stock market where tech stocks led the way towards that cliff.

The reason – even at that point – when 2018 was drawing to a close it seemed that the Cryptocurreny market was destined to be a relic of financial history. However, the reality might be slightly different – even institutional investors seem to be taking a new interest. The truth of the matter is that the model used to provide Cryptocurrencies is not at all flawed – it may simply not have been marketed correctly. This may in part be due to regulatory approval – big government is no fan of a currency that is in essence completely private – and can therefore not attract a tax income. However there is one simple truth – Crypto is not going away anytime soon and those who are holding on to the Granddaddy – Bitcoin may be best served by holding on a little longer.

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