Debt Management Archives - The Free Financial Advisor

Financial Stability and Marriage

March 18, 2020 by Jacob Sensiba Leave a Comment

Marriage and finances. A match made in hell. Why do these so often go together like oil and water? Why is money such a contentious topic in most households?

It’s because people go through life differently. Depending on how you were raised, what you learned, and what you personally experienced, your money philosophy will be different from that of your spouse.

Before we talk about that, however, I’d like to touch on financial stability and why the growing trend is being financially stable before committing to someone.

Financial Stability

It makes sense from a psychological perspective. Having financial stability makes you appear more mature and that you have your priorities straight. People who see that, probably see someone that’s ready for a commitment.

Additionally, getting married, and marriage in general, can be an expensive endeavor.

Obviously, it depends on the wedding you want, but the average price tag on a wedding nowadays is around $25,000 (source). Add onto that a honeymoon that could take you to another state, if not another country, and you’re spending a lot of money within the first month of being married.

What, historically, follows is a house and kids. Both, though worth every penny and minute, are expensive.

Because everyone has a different experience, and there are so many of them out there, I can’t go into detail about every one of them. Instead, I’ll speak generally about what they are trying to do.

Debt

People are trying to get out of or get a firm grasp on their debt. Whether it’s student loans, credit card debt, or medical bills, nobody wants to go into a committed relationship, let alone marriage, with a significant amount of debt.

Not only does debt hinder you from putting it towards future wants and needs, but when you get married, your debt becomes your spouse’s debt as well. You don’t want to burden them with that.

People want to be financially stable going into a marriage so they can afford the wants that often come with marriage, and they don’t want to be sacked with debt that brings down the family balance sheet.

Credit

Another piece of the financial puzzle that people try improving is their credit score. Your credit score plays a factor in almost every important life event. Where you live, where you work, and what you drive, your score could play a role.

Your financial philosophy is how you view money and how you use it.

Philosophy

Are you a saver or a spender? Do you view credit cards as a tool or a money sucker? When you do spend, do you prefer to buy stuff or experiences? Would you rather invest with the chance to earn more or put those dollars in a savings account for safekeeping?

As I mentioned before, your upbringing, what you’ve learned, and your personal experiences shaped the answers to these questions.

When you commit to a relationship, you’re going to have different answers. The key with any part of marriage, and money is no exception, are compromise and communication. You have to find some middle ground so each individual is getting their needs met, to an extent.

What you have to do is sit down with your significant other, dive deep into each other’s life experiences with regard to money, and what’s important to you, both now and in the future.

Once you have a good understanding of where you’re both coming from and what you want, you can work together to develop a plan, and once you have that plan, you can start executing

Debt Consolidation Loans for Bad Credit: What Are Your Options?

March 10, 2020 by Susan Paige Leave a Comment

American household debt reached a whopping $13.21 trillion in 2018. Add the number of students who enrolled in classes and people currently signing up for credit cards, and you have a massive debt issue.

Many people are knee-deep in debt- even savvy savers and high earners.

If you’re wondering about debt consolidation loans for bad credit, you need to know what options you have and which loans can be a good fit for you.

Below are some crucial tips on navigating debt relief in its various forms.

Consolidation Loans for Bad Credit

Debt consolidation for bad credit can turn out to be a great success if you are well informed.

When you consolidate your debt, you stand to reduce overall payments and can pay off your debts faster without borrowing money in the direct sense.

How does consolidating student loans with bad credit work? You take several loans accumulating interest and/or debt and turn them into one loan.

Keep in mind that your credit score will usually affect your repayment plan. Still, consolidation is considered less risky, meaning you are more likely to pay off all your loans sooner with a consolidation plan than you would by paying them individually.

A consolidation company essentially buys your loans and offers you one monthly payment. Student loan consolidation with bad credit makes it easier to budget, saving you time and money in the long run.

Refinancing Loans with Bad Credit

Wondering how to refinance student loans with bad credit?

When you refinance your student loans, you will need to go through a private lender. Your private lender pays off your current loans and offers you a new loan. Your new loan has its own interest rate and payment schedule.

If you meet the eligibility requirements, you may find yourself paying off the new loan with ease. Of course, if you have bad credit, this could affect which lenders will offer a repayment plan.

You can always get a cosigner to receive a lower interest rate. Make sure you and your cosigner are on the same page about their amount of involvement and what they might expect from you during the repayment process. Communication goes a long way in this case.

Credit Counseling

Credit counseling can help you decide between different repayment options based on your financial goals.

For instance, if you are looking to pay off a balance on a credit card with high interest, you might be interested in starting a debt avalanche. Not to worry- this can be good for your credit. You pay more money initially, but you save a lot in interest.

If you have a number of accounts open and limited monthly funds, you might try the snowball method.

The snowball method focuses first on the account with the smallest balance, giving you a feeling of accomplishment. Since you are still eliminating debt, you gradually accumulate momentum until you’ve paid off your debts.

If you’re having trouble finding someone to help consolidate your debt, you can look to a credit union or nonprofit. Both tend to be more people-focused but may have limited funds depending on their customer base.

A credit union or nonprofit can connect you to another lender or provide inhouse services, depending on your needs and your credit.

Wrap Up

Don’t let debt pull you under. With a little patience and the right help, you can pay off your debts and help your credit score recover.

Contact us with any questions you might have about consolidation loans for bad credit. We address your needs with your financial well being at the forefront.

For more great Free Financial Advisor Articles, read these:

How Long Should You Keep Financial Records After A Death?

Advantages and Disadvantages of Saving Money In The Bank

What To Do When You’re Behind On Your Mortgage

Financial Planning Basics: The Financial Pyramid

March 9, 2020 by Jacob Sensiba 1 Comment

The first time I heard about the financial pyramid, I was instantly intrigued. I had never thought about it in this concept before, but I unintentionally had been practicing this in my own life.

In finances you have to build the base before you can reach the top or it will all fall apart, hence the allegory of a pyramid.

The Base

The base of your financial pyramid should be a solid financial plan. This includes your written budget, short-term and long term goals, and how you will make your income as well as an investment plan to be implemented in the future.

You should have a positive cash flow, meaning, no longer using debt to fund your lifestyle.

Once you have implemented the base, you can move onto the first building block: protection.

Protection

You must protect yourself from the unimaginable, so I recommend everyone have a will and power of attorney, insurances such as life, health, auto, homeowner’s/renter’s, and disability, and a basic emergency fund of at least $1,000-$2,500.

I was thankful to have my mini-emergency fund when I had some car issues because I was able to pay cash to repair them instead of having to go into debt. The overall pyramid looks something like this:

The second building block is low-risk wealth accumulation. This would include saving for a home, retirement, and children’s college education, in addition to reducing consumer debt.

Debt Reduction

Financial guru Dave Ramsey teaches that you should get completely rid of any debt before beginning savings, although, in my opinion, you should still invest in retirement while reducing debt only if your employer offers a match.

I, myself, am in the debt reduction stage but still contribute to my retirement account since my employer offers up to a 4% match into my 401(k).

Additionally in this step, you should create your emergency savings fund. Many people believe an emergency fund of 3-6 months’ worth of expenses is adequate.

Investing

The third building block is high-risk wealth accumulation. This includes investing. Expanding on the second block, in this stage, you will max out your retirement accounts and then build a non-registered investment portfolio.

Once you have built your net worth to an amount sufficient to fund your lifestyle and retirement, you can move to the next stage of investing– speculation (also known as speculative investing.) In this stage, you invest money into investments such as start-up companies.

This is very risky, so you don’t want any debt by this stage. Also, you should only invest a small portion of your total investments into speculation. Also in this stage, you’ll want to begin tax planning, especially as your retirement investments increase.

Estate and Charity

The final building block is wealth distribution. You’ll gift and spend the money you have earned. As well as plan your estate for future generations or charity upon your death. Since your net worth increased quite a bit since you first started the financial planning pyramid, you should update your will and/or trust.

Finally, once you’ve got these basics nailed down, it’s time to hire some help. One approach a lot of millennials use is robo-advisors. A robo-advisor is a machine that uses various theories about portfolio allocation to make investing decisions. If you’re interested in a critical review of this, consider checking out Roboadvisorpros.com, they have a good article on the topic.

If you aren’t into trusting your cash to a computer, consider signing up with Personal Captial. They’ve pretty much become an industry leader among the newer financial planning firms.

If you’re’ going to use them, please use this link or click on the banner below. It will help keep the lights on here at The Free Financial Advisor.

For help getting your financial pyramid in order, check out these great articles.

10 Best Financial Planning Blogs
Best Free Financial Advice
Become a Financial Expert Step-by-Step

What Happens When You Fall Behind On Your Mortgage?

March 4, 2020 by Jacob Sensiba 33 Comments

what-to-do-when-youre-behind-on-your-mortgage

What does the bank do if you’re barely hanging onto your mortgage? What if you’re still a little behind, or a lot behind, on your mortgage?

First, it depends on your definition of behind. It may not be the same as the bank’s definition (not shocking). Let’s examine:

1 – 15 Days Late

Most companies allow a 15-day grace period before tacking on any additional fees. I know that being self-employed, my mortgage company calls me on the second of the month if I didn’t pay on the first, but there’s nothing to worry about if you’re “behind” less than 15 days. No big deal. That’s why they call it a “grace” period.

15 – 30 Days Late

If you’re in that 15 to 30-day time frame, prepare for a ton of telephone calls from your mortgage service provider (probably between two and four a day). You’ll also begin receiving letters reminding you that if you forgot to pay your bill, now would be the perfect time to make that payment.

Back when my income was very unsteady, a sneaky trick my mortgage company would pull was to send out another bill insinuating that I was two months behind and that if I disagreed with them I should call ASAP. Sneaky snake oil salesmen they were.

During this fifteen to thirty day period, if you can’t pay, don’t worry about the phone calls. You’ll have to pay a small late fee of some kind, but there still won’t be any damage to your credit report.

30 – 59 Days Late

It’s important to note here: If you’re running up against that 30-day late period, it’s best to drop everything and pay your mortgage. Even if you’re habitually late 29 days; it’s better than being 30 days late from a credit reporting standpoint.

Now the letters and phone calls increase dramatically until you’re 60 days late. Your credit report will note your current late status. Your credit score will fall.

60 – 90 Days Late

Here the phone calls and letters will cease. Does the mortgage company give up? Ah…that would be nice, but alas, no. They change tactics.

Once you’re over 60 days late, they’re going to send someone out to your house, just to make sure it and you are still there. You can see these people coming a mile away.

They circle your block two or three times, usually, they don’t look like they belong in your neighborhood, then they run up to your front door, peer in a window or two and leave a note on your door saying “Sorry we missed you. Please call us at once.”

It’s at this point you should start preparing for your next steps. If you’re 60 or 90 days past due, it’s probably a lingering problem, but all hope isn’t lost.

The best thing you can do when you’re behind is to communicate with your lender. Home lenders have instituted a number of programs to help you work through your late status.

The second biggest thing to remember is that the people you talk to don’t know you and you don’t know them. They don’t care about your problems. It makes no difference to them whether you stay in your house. They’re a thousand miles away in a cubicle. Stay calm while talking to your lender.

When you’re behind more than 30 days, you need to start talking – but don’t wait until it’s too late. Call your mortgage company, explain your personal circumstances, and begin laying the groundwork to solve the problem.

Can you pay the late payment over a couple of months? How about rolling that payment to the back of the mortgage? Can they waive a fee or two? Sometimes they will, sometimes not, but you’ll never know if you don’t ask.

Next week I’ll talk about the different options you have when you’re really behind on your mortgage and what they all mean. Stay tuned!

For more on paying off your Mortgage and ways to help you do it check out these articles.

Pay a Little Extra on Your Mortgage – What a Difference it Makes
6 Tips for Paying off Your Mortgage Quickly (Without Going Broke)
Don’t Be Afraid to Refinance: 6 Options to Meet Your Financial Needs

Photo: Hanging On: Jess2284

My Goals for 2020

January 1, 2020 by Jacob Sensiba Leave a Comment

Now that we’ve turned the calendar to another year, another decade, it’s time to figure what goals we would like to set.

Specifically, in this post, I’m going to go over the goals that I’m setting for myself, why I’m setting that goal, and how I’m going to put a system in place to achieve that goal.

What are my goals for 2020?

Get out of debt – Bought a house in 2019 and bit off more than I could chew. The divorce also threw a wrench in my financial planning.
Save for retirement – I’ve put my savings on hold for the time being due to poor financial decisions that led to the debt, etc.
Incorporate a meditation practice – I’ve harped on it and studies show how much it helps. I need to do this.
Journal every day – When I remember to journal, those are generally good days. I need to do this consistently.
Read every day – Reading can only help me, so why wouldn’t I do it more? I’ll learn something new and it’s shown to provide some meditative benefits.
Spend more dedicated time with my son – I’ve found myself over the last month or so having my phone out more than normal. I mean, I’ve had quite a lot going on with work and mentally, but that’s no excuse. He deserves better.
Exercise regularly – it’s good for my body and my mind. It’s a must.

Typically, when you’re setting goals, you should be very specific. You’ll notice, that I wasn’t. I get more granular with my goals in the systems section.

My systems

Getting out of debt and saving for retirement we can lump into one system, as they both revolve around finances and me reigning in my spending.

Until April, this will be incredibly challenging, as I am currently paying my mortgage on my house and the rent for my apartment.

So until I get my house rented (I have tenants set to move in, in April), I’m kind of stuck. Once that happens, however, I’ll have the debt repayment pedal down to the floor.

Simultaneously, I’ll contribute $20 per month to my retirement account, just to get in the habit of doing it again. Start small, enforce the habit, then increase the dollar amount.

Meditation

Of my goals, incorporating meditation practice should be relatively easy. I know my preferred style – I’m not one to sit pretzel-legged on a cushion. I lay down on the floor, on my back, which some relaxing music playing.

The hard part is a) making the time for it and b) doing it consistently. To start, I’m going to set my alarm for 5 minutes earlier than normal.

5 minutes might not seem like a lot, but if I wake up 5 minutes earlier, that gives me 5 minutes to meditate. If I do that consistently for the next, say three weeks, those extra 5 minutes won’t seem that, and I can scale it to 10 minutes.

As I noted in last week’s article, when forming a habit, you have to start small and then scale up.

Reading

Reading every day. This is a must-do for me. It’s good for my mind, it’s good for my soul, it’s good for everything. I have a great many books on my list, but they will all fall into a specific genre – finance, philosophy, religion, or biographies.

The first one will help with work. The last three will help with life.

Every day, before bed, I’m going to read for 15 minutes. That’s my starting point. Once I get into the habit, the amount of time I read will increase.

Spending time with my son

Spend more dedicated time with my son. This is an easy one. Just stay off my gosh darn phone.

Keep it in my room or in the kitchen. Not in my pocket, where I can easily access it. Put the ringer on and leave it alone.

If it’s an emergency, someone will call and I will hear it.

This will also eliminate a distraction, so if he goes to bed for the night, I can immediately pick up a book without getting sucked into the social media black hole.

Exercise

Exercising every day. I read recently in a book about the Dalai Lama that exercising your mind is more important than exercising your body, so I’ve put that on the back burner.

I have a pull-up bar in the doorway to my bathroom and I do 5 pull-ups every time I go in, but that’s not enough dedicated, consistent time for exercise.

I think doing it in the morning makes the most sense. I’m too tired in the evenings to exercise. The question is, do I do this before or after meditation?

Probably after, as I need my mind at ease when I meditate.

So instead of waking up 5 minutes earlier, I’ll start by waking up 20 minutes earlier. Dedicated 15 of those minutes to exercise and the remaining 5 for meditation.

Simple Solutions for Repaying Student Loan Debt

December 13, 2019 by Susan Paige Leave a Comment

As valuable as education is, it’s awfully expensive. Most students these days look to outside help for finances to help them get through school and land their dream job with the help of a degree or certificate. Unfortunately, getting to that dream can often cost us thousands of dollars in student loan debt. The good thing? Getting over that hump of paying back our student loans is not nearly as insurmountable as it sounds. Check out these helpful ways that will lead you down the path to financial freedom and out of debt.

Live Modestly

It can be hard to live within our means sometimes. We want to go out and socialize, have a few drinks, catch a movie with our pals. The unfortunate truth is that these little expenditures add up in a big way. It’s okay to go out and live your life, or buy some snack food every once in a while, but remember to stay within your means. Whether you’re about to graduate and begin paying back your student loans or you’re already done your education and are in the process of paying them back, spend as little as possible, when possible.

Figure Out Your Options

Repaying your student loan debts doesn’t have to be done all by yourself. Asking for help or reaching out for support isn’t something to be ashamed of either. It’ll alleviate some of the stress in your life to research how you can pay your loans. Consider all your options; savings accounts, Elfi, loan assistance services, borrow from family, work a secondary job. These are among the many ways you can help chip away at those pesky loans and allow you to feel mentally and financially free, ready to take on the world with your career. There are always options to help you out, don’t be afraid to exercise them!

Pay More Than the Minimum

This tip feels really straight forward but it’s worth mentioning because it is often overlooked. Paying more than the minimum payments for your loans can mean the difference in months of how long it takes to fully pay off your debt. It doesn’t mean you have to pay a massively increased amount each month, but simply paying a percentage of the minimum added on, will reduce the overall time. Another good trick is to split the payments in half for each month so the money you spend doesn’t take chunks out of your rent, groceries, or other necessary bills.

Conclusion

Repaying student loans is an unfortunate reality for many students and graduates. Although it can feel defeating to get your education and know you have to take chunks out of your paycheck each week, the goal of financial freedom is one that requires some sacrifices at times. Keeping these tips and tricks handy is a good way to set yourself up for success in paying off your student loans and is also a great way to develop responsible spending and saving habits when it comes to your money in general.

Incidentally, if you are interested in learning about some radical solutions to the student loan debt problem, the Saving Advice Forums has an excellent discussion about a 5,000 year old proposal for paying off student loan debt. Basically the idea is to cancel all Federally held student loan debt in the country to improve economic growth.

For more great articles on The Free Financial Advisor, consider reading our pieces on:

How Long Should You Keep Financial Records After A Death

What Are Some Of The Advantages And Disadvantages Of Keeping Money In The Bank

Financial Planning Basics – The Finance Pyramid

Image source: Pixabay.

How To Pay Off Your Student Loans Quickly

December 9, 2019 by Susan Paige Leave a Comment

Student loan debt is becoming a common financial crisis in the United States. A majority of students are graduating with huge amounts of debt and feeling crushed by the financial burden. More and more graduates are searching for ways to pay off student loans quickly so they can experience financial freedom before making other financial investments.

It’s unfair that an entire generation of young Americans have to wait even longer than older generations to purchase a home or start saving for retirement simply because they wanted to get an education. Therefore, if you have student loan debt it’s a good idea to employ every strategy that you can to pay it off quickly.

This article will go over a few general tips and strategies for how you could quickly pay down your student loan balances, so you can become financially independent once more!

Make Sure to Fit Debt into Your Budget

When making your monthly budget, whether you are single and just out of school or budgeting for a family, always take your student debt into account. Budget in your student loan debt, credit card debt, title loan debt, mortgage, and any other debt you may have. Make sure you include your debts into your budgets as they should always be the main priority. Try to allocate more money toward your debt than what is required.

Pay Extra on Higher Interest Loans

If you are going to make extra payments on your student loans over the minimum, then put that extra cash towards higher interest loans. The interest rates are constantly growing your debt load and paying off those loans with the highest rates first will save you money in the long run. And when paying more than your minimum, tell your servicer to apply that overage to your current balance and not simply to next month’s payment.

Determine Whether Refinancing is Right for You

When trying to decide whether refinancing is a good idea or not, it is not a clear black and white determination. It completely depends upon the situation; whether your loans are federal or private, whether you have good credit and a good job, whether your loans are subsidized or unsubsidized. Research your options, calculate how you might save or lose money, and make the decision that is best for you.

Enroll in Autopay

Make sure that you never miss a payment or get charged a late fee by signing up for autopay. Enrolling in autopay can even get you a minor interest rate discount with federal servicers. Along with the discount, you will be able to set up multiple payments and ensure you pay your loans as a priority.

Pay More than Once a Month

Instead of just paying once a month, you can trick yourself into paying way more and cutting down your repayment schedule drastically by simply making two payments a month instead. This doesn’t even mean you have to pay double a month, but just twice. That will still make a difference.

Persistence and hard work will take care of your student loan debt once and for all. Just stick with it and follow these suggestions and before you know it, you’ll see that the diligence was so worth it.

For more reading, consider checking out this article from Nerdwallet on how to pay off your student loans fast.

Image source: Pexels.com

Debt Collectors With Attitude

November 20, 2019 by Jacob Sensiba Leave a Comment

Debt collectors and debt collection agencies are a real pain! They’re persistent, and sometimes, they can be downright mean.

However, there are still laws that govern them. If you come in contact with an aggressive collector, here’s what you have to know.

Fair Debt Collection Practices Act

The Fair Debt Collection Practices Act (FDCPA) is the law that governs what third-party debt collectors can and can’t do.

Things they can’t do include calling before 8 am and after 9 pm based on your time zone, call you at work, harass, oppress, or abuse you, lie to you, threaten you with jail time, conceal their identity, disregarding a written request from you to cease contact or dispute a debt.

Debt collectors also can’t reveal any personal information about your debt to people, except your spouse or your guardian (if you’re a minor).

Mail correspondence can’t show that the mailer is from a debt collector. Also, if you hire an attorney and the collector has your attorney’s contact information, they must correspond with your legal counsel, not you.

If the debt collector violates any of the parameters set by the FDCPA, you have one year from the date of the violation to file a complaint. You can do that by using the online form, here, or by calling (855) 411-2372.

Take notes

If it ever gets to the point where you file a complaint or sue the collector, copious notes will help you make your case.

Get as many details as possible. Time, date, name of the collector, the agency they work for, the debt they are calling about, etc.

Hang up or don’t answer

If the call is from a number you don’t recognize, don’t answer. If the call was important, they’ll leave a message.

Typically, debt collectors are dialing for dollars (calling A LOT), so they typically won’t leave messages. If they do, listen to it and do your research to confirm if it’s legit or not.

In a lot of cases, consumers don’t know what they’re rights are. Even though collectors must abide by the laws set forth in the FDCPA, they might not if they think they’re speaking with an uninformed individual.

If they start badgering you, use aggressive language, or violate the law in any other manner, just hang up the phone.

Write a letter

You can write a letter to a debt collector for two reasons.

One, asking them to stop. They HAVE to stop if you put it in writing. Two, dispute the debt. If you believe that the debt they are trying to collect is fraudulent or not yours, write a letter to dispute it.

Cool heads prevail

Debt collectors are ruthless. Their objective is to get as much out of you as possible before they sell the remaining portion of your debt to the next collector in line.

It’s human nature to get worked up or downright pissed off in this situation, but getting angry won’t help you.

Collectors have been conditioned to withstand a verbal thrashing from consumers. Staying calm will keep your blood pressure down and help you think straight.

How to Take Control of Your Finances and Get Out of Debt

November 11, 2019 by Susan Paige Leave a Comment

If you have a large amount of debt, you’re not alone. Statistics say that many people are living with debts. But the truth is, no matter the situation you’re in, you can get out of it, invest, and make more money. Just make a decision then plan wisely. Having an appropriate plan will help an individual get out of debt quickly and take control of their finances. That said here is how individuals can get started. [Read more…]

Benefits of Bridging Loans For Your Financial Needs

October 1, 2019 by Susan Paige Leave a Comment

Woman thinking about a bridge loan.

Depending on your circumstances, you may see bridging loans to be an affordable and accessible financing option when it comes to dealing with properties. They refer to a type of loan that allows clients to purchase a new house while they’re still in the process of paying and, later on, selling an existing home. Because of this, bridging loans have become a popular method of funding a property purchase.

If you haven’t heard much about bridging loans, let’s take a look at how these loans can become beneficial for your financial needs.

Quick To Arrange

Gaining access to a significant amount of money can sometimes require a few weeks or months. This setup, for instance, is typical to business loans and other residential mortgages. So, if you’re looking forward to borrowing money in the quickest way possible, then a bridging loan can be an ideal choice. So long as you have adequate equity in the property and a few properties for security, the loan you’ve applied for will be there in your account in less than 48 hours.

All Types Of Property As A Security

Another essential benefit of applying for bridging loans is the type of property you can use as security. Whether you have flats, shops, development land, offices, farms, commercial units, and many more, you can utilize all of these properties to secure a bridging loan and think about how you can get the most out of the money for your financial needs. In short, this type of loan doesn’t require any specific property before you can get approved and enjoy its benefits.

Unlimited Potential Applications

In addition to properties as a security, a bridging loan comes with limitless potential applications. While most conventional banks and lenders pay attention to the intended purpose of a loan, it’s different when it comes to bridging loans.

With this type of loan, you can use it for whatever purpose you like. All you have to do is prove your ability to pay back the loan, and your application will go smoothly without giving justification to it.

If you find yourself needing a bridging loan to cover a particular purpose, many private lenders like www.novellusbridging.co.uk in the UK and other places can help you.

No Need For Monthly Payments

Typically, bridging loans don’t require monthly payments during the first few months. Thus, the entire process becomes easier since you don’t need to fret about your monthly payments along with your other expenses.

Moreover, a bridging loan can also provide you with adequate time to sell your existing home and pay off your loan, again without worrying about the monthly payments. This is what makes this type of loan a flexible funding option these days.

Low Fees And Interest Rates

By its very nature, a bridging loan seems to be more affordable than the loans and mortgages offered by traditional lenders. Since the loan will be completely paid off within a few months, you can be sure that you’re not going to pay annual or monthly interest rates and other fees.

Security Over Properties In A State Of Neglect

As mentioned, all types of properties can be used to secure a bridging loan. However, one other good thing about this type of financing option is its ability to accept real estate properties that are in a state of neglect. Even if your existing properties are in urgent need of repair, applying for a bridging loan allows you to use them to secure a loan. This is another benefit that this type of loan has over traditional ones.