Cost of bridge loan – 110 000 covered by bridge loan the new home mortgage will be 640 000 800 000 160 000 640 000. On a 250 000 loan that has a 3 interest rate you might be paying 1 054 for a conventional loan an amount that would rise to 1 342 with a bridge loan that had a 2 higher interest rate.
As you read you might ask what s equity in a home.
Cost of bridge loan – 250 000 330 000 x 80 464 000. You make a down payment on your new home and have 5 000 left for closing costs. The reason for high interest rates on bridge loans is because the lender knows you will only have the loan for a short time. Cost of bridge loan
With a second mortgage bridge loan you borrow 60 000. This is the amount covered by the bridge loan. Additionally bridge loan rates can be as high as 8 to 10 depending on your loan amount and credit profile. Cost of bridge loan
Closing costs are usually a few thousand dollars plus up to 2 percent of the loan s original value and they usually come with origination fees and that s before you even close on your new home. For example if your current home is worth 250 000 and the home you want to buy is worth 330 000 your maximum bridge loan amount would be calculated this way. Typically for a bridge loan you can finance up to 80 of the combined value of both homes. Cost of bridge loan
Expect to pay 1 5 to 3 of the loan amount in closing costs for a bridge loan. The selling price less the cash on hand and the mortgage money available leaves a short of 110 000. So if you re selling a home for 200 000 and buying another one for 300 000 you can borrow 400 000. Cost of bridge loan
A bridge loan for 80 of the home s value or 240 000 pays off your current loan with 40 000 to spare. If the bridge loan closing costs and fees are 5 000 you re left with 35 000 to put down. Cost of bridge loan