Guarantor Loans as Bridging Loans
We've all been there, we've fallin in love with our perfect house and our offer has been accepted. There is one small problem, in todays day and age with houses selling slower than paint dries there is a huge risk of the sale falling through if someone else gets lucky enough to sell their home before yours. A guarantor loan bridging loan may be the best way to keep things bang on track and you days away from the home of your dreams.
Approach Guarantor Loans with Caution
It's certainly worth being careful before you take a guarantor loan because they are more expensive than your typical secured loan but are still cheaper than many other options. Definitely look at all your options before you push ahead.
Short term loans
Short term loans can tide you over and the extra expense you pay may well save you from costing you the money you have already spent in the purhase so far. Obviously this will reduce the amount of stress you are going to suffer. Make sure you are doing it for the right reasons because it is very easy to end up in serious financial difficulty.
Loans with No Early Repayment Fees
As you are taking the guarantor loan for a short term make sure the company you use as the lender has no early repayment fee otherwise known as early settlement fees. Most guarantor loans lenders will pile the interest up front and this can make early payment really very expensive, so make sure you know what to expect. Ask them for a break down if you pay after 2 months 4 months and so on so you can see how it changes. Only when you're happy push ahead. Early settlement penalties can be a nasty shock you can avoid with a little research.
Make sure the sale is going through
If you are going to get a guarantor loan as a bridging loan as part of a house purchase you need to understand the economy in the UK right now. The property market is suffering a dramatic slump and the traditional mortgage lenders are seriously cutting back on financing. So much so that many sales are falling through. Make sure you have everything in place and everything in hand before you take out the bridging guarantor loan. However, if you are getting the loan because you are having trouble selling your house and what to get moving into your new dream home then a bridging loan is probably not going to be the right choice.
