Bridging finance and refinance

Hello guys

If we take bridging loan now .Which has been approved
Can one refinance within the 12 months period.,? If the income stacks up.

 

Refi the bridge?

Possibly, although if the lender finds the house has been on the market more than 6 months already, they'd probably raise some eyebrows.

I've never tried to do this, so I'm just thinking out loud.

 

I believe OP talking about getting bridging loan 12 months because can't show servicing.
Then within the 12months servicing improved (income stacks up)
Then refinancing to a traditional loan (no bridging clause)

Yes absolutely can be done.

 

Exactly spot on.

That was the question.

 

Oh right! Yes for sure, that can be done.

 

Thank you.

So if the current financials are supporting the loan amount we can refinance the bridging loan.

Can bridging loans be extended? the one offered was a 12 months loan. Or its a hard and fast 12 months.

 

Wait wait, now looks like you're asking for bridging refinance to another bridging. NO

Bridging loan (can't show servicing on full loan) can be refinanced by normal loan (but only if you can now show the income to support)

Don't be looking at getting bridging expecting can be refinanced to another bank with bridging.
Or don't expect the bank to extend.
In saying that I've had a few bridging loans extended, but also had a couple declined to be extended.
I would only be relying on 12 months hard and fast

 

If you go over the time period it is a breach of contract, but what are they going to do practically speaking - give you an extension rather than sell you up.

 

With the extensions that were declined, what happened next?

 

Can't speak for Brady- but I've seen this where it becomes a default and gets sent to the lender's collections team. Not good things.

 

Dang - not good - as if I needed another reason not to do 'em, they fit a need I guess.

 

I wrote a bridging loan with ANZ early last year. The client was required to write a letter that stated that they would, "Meet the market", if the property hadn't been sold within 6 months.

They did have to meet those conditions a few month later and they sold the property for less than the original valuation. Overall they came out of it okay, but they did get a number of unpleasant calls and letters from the bank.

 

Pretty much lots of pressure, had to show that was actually marketing the property

In 1 case client hadn't even put on the market as wanted to renovate, completely against all original discussion.
In the end he ended up selling the new property and went back to the old to complete renovations.
Costly exercise.

Other cases of approval of extension was with evidence of lowered asking price, switching of real estate agent, pending auction.