
Bridging Loan to Downsize to Retirement Property Before Current Home Sells
The Scenario
Our client approached us during a period of significant change in their life.
They’d lived in their home for many years, but in the last few years, the husband had passed away, and mobility was becoming more of an issue, so they’d decided to start looking at retirement properties and sell their house to fund the move.
A retirement living property, also referred to as a ‘later living’ property, would give them the community and security they needed to feel comfortable and safe in their home without it encroaching on their independence or privacy like a care home might.
They would have easy access to support if they needed it and a community that would watch out for them, keeping hold of their independence and having their own space.
However, they needed to move fairly quickly on their purchase, having found their perfect property close to their family and an area they knew well. The vendor was after a quick sale, so being able to act fast was critical. But to purchase the retirement home, they needed to sell their existing property. This would take months and could cause considerable stress if they had to rush the process.
The Solution
With a time-sensitive problem like this that has the potential to get complex and stressful, a bridging loan can relieve all the pressure.
A bridging loan is a short term loan secured against your existing property that can be used to buy a new property and is then repaid when you sell yours.
In this case, our client was downsizing – they were buying the retirement property for £375k and selling their current home for £550k with no outstanding mortgage.
Our broker arranged a short term bridging loan of £400k to buy the new home while the current property sold.
Acting as a cash buyer with the loan behind them, our client could guarantee to secure the new property at a reasonable price while also having enough funds left over to cover any stamp duty, legal fees and moving costs.
And with a 12-month loan term, they had up to a full year for the sale of their existing home to complete, giving it time on the market to generate interest and receive the best offer possible, whilst also knowing that they would only pay interest for the exact number of days the loan was needed.
Thanks to using a bridging lender we have a great relationship with, we negotiated a discount on their initial fee to 1.5% of the loan (where you will often pay 2%) and an interest rate of only 0.42% per month.
We also cut costs by only requiring a valuation for their existing property and not the new home, as the lender just needed to ensure its sale would cover the value of the bridge loan.
But looking at the bigger picture, the client also really appreciated being able to move into their new home before selling, so the practicality and peace of mind that the bridging loan provided far outweighed the monetary costs, especially during a stressful transition period for our client.
Louis Levine
Finance Executive CeMAP
Bristol
0117 457 7862
Are you looking for a similar type of property finance?
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George Abouzolof
Finance Broker
Bristol
0117 403 3444
Do you need help sourcing your own property finance?
I have extensive experience securing UK mortgages for expat clients. Book a free telephone consultation with me at a time to suit you
Bridging Team
Clifton Private Finance
Bristol
0117 959 5094
Are you in need of a similar type of property finance?
Book a free telephone consultation with one of our bridging specialists today and see how we can help you.
Sam Baker
Finance Broker
Cardiff
0117 959 5094
Are you looking for a similar type of property finance?
As a specialist bridging adviser at Clifton Private Finance, I can take a holistic view of your situation and find the right finance solution for you. Book a free telephone consultation with me at a time to suit you
Fergus Allen
Finance Broker
Cardiff
0117 959 5094
Are you in a similar situation? I specialise in bridging finance at Clifton Private Finance - I will find you the best funding solution for your property transaction.
Book a free telephone consultation with me at a time to suit you
Jacob Phipps
Finance Broker
Bristol
(+44) 0117 959 5094
Are you looking for a similar type of property finance?
I specialize in helping international clients source residential and investment property finance for UK property. Book a free telephone consultation with me at a time to suit you
Jack Spillane
Finance Broker
Bristol
0117 959 5094
Mathew Phillips
Senior Finance Broker
Bristol
0117 959 5094
Are you in a similar situation? I specialise in bridging finance at Clifton Private Finance - I will find you the best funding solution for your property transaction.
Book a free telephone consultation with me at a time to suit you
Alex Chambers
Senior Finance Broker
Bristol
0117 403 4324
Are you in a similar situation? I am a specialist in residential and investment property finance for UK and international clients at Clifton Private Finance. Please don't hesitate to get in touch for a no-cost discussion of the finance you need.
Book a telephone consultation at a time that suits you:
Luther Yeates
Senior Finance Broker
Bristol
0117 244 5561
Are you looking for a similar type of property finance?
I have extensive experience finding residential and investment property finance for UK and international clients. Book a free telephone consultation with me at a time to suit you.
Sam ONeill
Senior Finance Broker
Bristol
0117 959 5094
Is your situation similar?
I am a bridging finance specialist at Clifton Private Finance. I can find a quick, cost-effective solution for the funding you're looking for. Book a free telephone consultation with me at a time to suit you
Robert Gibb
Senior Finance Broker
Bristol
0117 959 5094
Are you looking for mortgage or short-term finance for residential or buy-to-let property (including HMOs)? I have extensive experience in finding property finance solutions for UK and international clients, both as individuals and limited companies. Please give me a call and let me see what I can do for you.
Book ConsultationAdam Arnott
Associate Director
Bristol
0117 205 0214