Bridging loans

[josh64]

what exactly is a bridging loan and what are the advantages and disadvantages of it?

[dzug]

A bridging loan is what you need if you buy a house before selling your old one and need extra funds.

Advantages - you get the house you want and don't risk losing it to someone else

Disadvantages - expensive and open-ended; you don't know when or even if your old house will sell to give you the cash to repay the loan.

[Oneeyedvic]

Its not just used for buying houses - it can be used to help stop repossession, to renovate a house, etc.

You are borrowing the money purely on the equity on the property and you can often have 'rolled up' interest, where you don't pay a monthly interest charge, but pay it all off at the end.