I wrote a popular blog on Monday about bridge loans – Bridge Loan & Buy-Before-You-Sell Options – and am following up today to provide some additional color, and to announce that our most popular option, “EasyPath,” just dropped in price significantly!
EasyPath is our best, most affordable bridge loan alternative product… and it just got better. From now through the end of March, buyers can pay as little as $999* instead of the usual $2,500 flat fee.
In light of this, I wanted to share a slightly different approach to explaining our bridge programs and set out three scenarios in which borrowers need bridge loans. There are a dozen different ways to structure these programs, so I am painting with a broad brush below.
Bridge Loan Scenarios
Scenario 1: Cannot qualify with both the current mortgage and new mortgage payments.
This is THE MOST common issue we see – even when borrowers already have a substantial down payment (outside of the current home’s equity) and strong income. Fortunately, this is solved by our easiest, and most affordable, solution: EasyPath. This option now costs only $999, and it erases a borrower’s current housing payment from the debt ratio equation – allowing a borrower to buy the new home first without having to sell their current home or request a sale contingency.
Scenario 2: Need to borrow against current equity for down payment.
If a borrower needs to access their current home’s equity for the down payment but cannot float both the current and the new home mortgage payments with their income, we can pursue one of these options:
- Adding a HELOC against the current residence to access the down payment funds + using the above EasyPath program to erase the payments associated with the HELOC and existing mortgage from the new loan application.
- Using an in-house, short-term portfolio loan that ignores the current debt ratios, which the borrower will pay off and/or refinance once their old home sells.
- Using a cross-collateralized private money loan that lends on the combined equity of both the existing and new home.
Scenario 3: Need to borrow against current equity for down payment but lack sufficient verifiable income to qualify traditionally.
Retirees with fixed income that is too low to qualify for traditional financing often need our solutions the most, as they often have no ability or desire to sell without having certainty around where they are going to move. For clients in this situation, we can explore:
- Using a cross-collateralized private money bridge loan that ONLY looks at the combined equity amongst both the existing and new home. NO INCOME qualification or approval is needed.
- Using one of our many No-Income, non-QM, asset-based loan programs for long-term, 30-year fixed financing solutions.
If you have clients who are facing these challenges, please reach out to our expert team to further explore how we can help them take their next step in homeownership!
*Please note: The departing home must be run through additional verifications to qualify. This offer is not currently available for condos. Please contact our team for additional details.
