Imagine you own your home in Santa Cruz outright, or have a very small mortgage on it. Let’s say your property is worth $850,000. You would love to buy your next Santa Cruz dream home which is valued at $1,000,000 but to do so you would need to access the equity of your current home to either pay cash or use as a down payment.  What would you do in this case?  Good news:  Santa Cruz Bridge Loans can come to the rescue.

In the past, the only options you had available were to either sell your home before you purchased a new home or make your offer based on a concurrent close, meaning you need to sell your home before you buy the new home.  Both options are sometimes difficult to accomplish, since if you sell you home first, where do you live in the short term? Or, if you make your offer contingent, it may be viewed as a less attractive offer since its dependent on your buyer being able to perform and close before you are fully committed to purchasing your home.  

Banks have recently rolled out a new product called a Cross Collateral Loan!

Cross Collateral Loans are often referred to as Bridge Loans, which allow you to borrow the required funds to complete your new purchase without waiting for your home to sell. Bridge Loan lenders allow you to put in non-contingent offers and close on your new home without having sold your old home.  In many cases you don’t even need a down payment as they secure their loan with both the new property and old property. This would make your offer much more attractive to a seller as they don’t have to wait until your home sells. 

This loan allow for 0% down payment and recasting, meaning you can keep this loan for a few years. You would still have to qualify for the loan, but there is no need to actually sell your home to obtain funds. 

After you sell your home you can either pay-off or pay-down the bridge loan. Or you could simply refinance the bridge loan or convert it into a regular mortgage loan. 

The convenience is yours – of being able to actively market your current home and still be able to place offers on properties without it being in contract.