Downsizing With A Bridging Loan

Downsizing With A Bridging Loan

Downsizing With A Bridging Loan

Downsizing With A Bridging Loan

How Can a Bridging Loan Help Me Downsize?

Madison Carter Finance provides bridging loans that offer quick access to funds for mature folks looking to downsize. Our loans enable retirees to become cash buyers, move rapidly, and purchase their ideal new home before selling their existing property, making downsizing easier and stress-free.

Fantastic service from start to finish!Steve not only worked on our remortgage but has since assisted with an investment property and advised on insurance aspects we were unaware of. A professional, efficient and helpful service, would highly recommend to friends & colleagues.Ben A

Ben Axton

UPDATE: We have access to a bridging loan for downsizers that runs to 60 months (5 years), if required.

How Can Downsizing With A Bridging Loan Help?

For some people reaching retirement age, the idea of continuing to maintain a larger property can be worrying. The idea of downsizing and relocating into a more practical, small home can, in turn, become increasingly attractive. Thats why Downsizing With A Bridging Loan can buy time before you put yours on the market and purchase in advance. This product is useful if you’ve had a sale fall through.

Many purpose-built retirement properties are popping up all over the country that offer additional social and lifestyle benefits. These are especially appealing to those who are keen to make the most of their later life. As a result, Downsizing seems an ideal prospect. 

Whether moving into one of these properties or into another, smaller home, retirees need to put their finances in order. They need to ensure that they have funds in place to move rapidly when they find the ideal new home. With this in mind, a Downsizing With A bridging loan could be the perfect solution. 

Downsizing With A Bridging Loan
Downsizing With A Bridging Loan

The big challenge of downsizing is aligning the sale of the existing property with the new one’s purchase. A lot of downsizers feel pressure to sell as fast as they can. That often leads to them settling for far less than they wanted for their current home. When downsizers are cash poor but asset rich, bridging loans are the ideal solution. They take the pressure off when selling a home and buying another.

Bridging loans put purchasers in the strongest position to put in an offer on their dream property. As a result, they can beat their competition. A bridging loan makes them cash buyers, so estate agents and vendors alike take them seriously. Buyers can get an offer of a bridging loan in principle in just 24 hours following application. That means they can move immediately when they find their perfect home.

Competition for property within popular retirement communities is high. With a bridging loan, buyers can move as soon as a home comes onto the market. They can also offer the vendor’s asking price straight away. That means they have a better chance of securing their chosen home.

They can also ask the property’s vendor to accept their offer and remove the property from the market immediately. They will then have the peace of mind that nobody else will be able to make an offer. 

If a buyer needs to downsize quickly after an injury or illness, a bridging loan is an excellent solution. It allows the purchase of a smaller property before selling the existing one. They can then sell their current property once the urgent situation is over.

Bridging loans are ideal for removing the pressure from a speedy sale. They give more time to carry out renovations or repairs so the current property can achieve the best price. There will be no pressure to accept the very first offer. The increased value of the current property can then help to offset the bridging loan’s costs.

Moving home is stressful, especially for older people. When there is no property chain, there are no tight completion deadlines. There is also no need to move out of the current property by a specific date. That makes it easier to manage the relocation process without anxiety. A bridging loan eliminates the property chain so sellers have more time to downsize without panicking.

Frequently Asked Questions When Downsizing With A Bridging Loan

Why Downsize?

Some people choose to remain in their large family home for many years after retiring. However, it is common for older adults to eventually downsize. Usually, this is simply because they no longer have the need for so much space. Plus, the burden of keeping a family-sized home clean, tidy, and maintained can simply become too much to cope with. 

Sometimes, seniors will downsize in stages. They may initially move from a large 4-5 bedroomed property to a smaller 2-3 bedroom apartment or house. At a later stage, they may then downsize again to a 1 bedroom or studio apartment. This often occurs after they lose their partner or begin to struggle with mobility or health issues. 

While there are many smaller homes on the market, purpose-built retirement accommodation presents an attractive possibility to pensioners. This type of accommodation allows independence alongside accessible social and leisure facilities and events. As an added bonus, these properties also offer onsite support for a more enjoyable, easier lifestyle. It isn’t too surprising, then, that these properties are extremely popular with older buyers. Therefore, prospective purchasers must be ready to take action quickly when their ideal home comes onto the market.

What Options Are There For Buying A Retirement Property?

Most people keen to downsize begin researching retirement properties before selling their current home. So, if they find the property they want, they can face a lack of funds. Buying a new property outright is usually impossible. Even those who have savings typically have locked them away for future use. Yet, with competition high for popular retirement living complex properties, retirees need to move quickly. That is where a bridging loan can prove to be invaluable.

Can People Over 55 Get A Bridging Loan?

Getting a traditional mortgage is more difficult when you’re over 55. However, bridging loan providers don’t look at earnings when considering applications. Pensioners, therefore, are just as likely to be receive approval as someone younger and in work. 

Anyone who owns their property outright has another advantage. They have more equity in their home so they can quickly repay the bridging loan after selling their house. 

What Do Bridging Loans Cost?

Bridging loans aren’t as expensive as you may imagine. The cost depends on the amount you’re borrowing as well as the length of time the loan is for. The costs of a bridging loan you need to bear in mind include:

  • The arrangement fee
  • The interest rate
  • The broker’s fee

You can add all or some of your bridging loan’s cost to your current property’s minimum asking price. As you’ll have more breathing space due to the bridging finance, you can hold out for the right offer.

For more information check our FAQ and the link to the cost of a bridging loan for more details.

How Will Bridging Finance Assist In Downsizing?

Downsizing bridging loans help prospective buyers to get funding rapidly with no length processes. They give quick access to money before selling their current property. That reduces the risks of losing out on the perfect new smaller home.

Downsizing bridging finance allows prospective downsizers to borrow the large sums they need. They can borrow anything between £500,000 and £10 million. There are no age restrictions and no upfront fees for application. They can secure the loan against either their existing home or the property they’re purchasing. They can borrow 100% of the purchase price plus fees and SDLT with requisite security.

You may also be interested in…

Is A Bridging Loan To Downsize For You?

Still unsure or want to go ahead?

You might want to look at our Equity Release London article before talking to us.

To find out more about the benefits of bridging finance for downsizing, contact Madison Carter Finance today.

The Financial Conduct Authority (FCA) may regulate your loan. If your loan is regulated we can deal with your application. It must be submitted through an FCA regulated intermediary.