To bridge your finances is easily explained when someone is buying a house, but they haven’t sold their existing house yet, and don’t have the funds for the purchase. It’s bridging the gap of time with a loan, while the existing house is being sold. Lenders often bridge funds for people buying and selling commercial equipment as well; so bridging loans aren’t exactly home loans, but they’re related. 

The main con is the risk of you not selling your existing home, or equipment, or vehicle in your anticipated time-frame. Interested is charged proportionally to how long you have the loans for, so it’s important you research the market and put emphasis into selling your assets quickly.

The preliminary approval process can be as little as 60mins. Full approval can take anything from 72 hours to a week to complete. It’s not the quickest type of finance to get approved for in New Zealand, due to its complexity, but once approved, you’ll get money in your account within 24 hours subject to passing credit checks and acting in accordance with the responsible lending code of NZ

During the bridging period, the interest on the loan gets added to your ongoing balance. While some loan structures only require you to make repayments when your existing property is sold, as responsible lenders, we encourage interest payments while waiting for your existing property to sell so the loan doesn’t grow into a larger debt.

If you don’t sell your existing home or equipment in the expected time-frame you’ll continue to accrue interest. Although we do run you through the the fine print, be sure to always read the terms and conditions on your loan agreement so you completely understand the fees associated with the finance provided.

Bridging loans are typically short-term loans that last for anywhere from a few weeks to a few months. However, the exact length of the loan will depend on the specific terms of the loan agreement.

The amount you can borrow with a bridging loan will depend on several factors, including the value of the property you are using as collateral, your creditworthiness, and the length of time you intend to borrow it for. Generally, bridging loans are available for amounts ranging from $50,000 NZD to 1 million dollars.

The interest rate on a bridging loan can vary depending on the amount of the loan, the borrowers history with us, and the borrower’s creditworthiness. Generally, bridging loans have higher interest rates than traditional mortgages due to their short-term nature and the increased risk to the lender, however, we offer some of the most competitive rates in New Zealand.

Yes, most bridging loans require collateral in the form of property. Alternate Finance will typically take a first charge on the property being used as collateral to secure the loan.