Bridging loan alternative for trader-upper

T

tonydrago

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Hi,

I own an apartment worth about 300k. The mortgage is fully paid off. I have about 150k in savings and would like to trade up to a house selling for between 400k and 450k. In the olden days, the typical approach was
  • Put apartment on the market
  • Bid on house
  • If the closing date of the house purchase is before the closing date of the apartment sale, use a bridging loan to pay for the house (i.e. the difference between savings and house price)
  • Pay off bridging loan when apartment sale closes
However, according to what I've been reading online, Irish lenders are no longer offering bridging loans. How would one handle the scenario above in the absence of bridging finance?

Thanks in advance,
Tony
 
We managed to close a purchase and sale on the same day, solicitor said we were very fortunate, rarely does it work like that.

We had planned to move in with parents temporarily, but this was not needed in the end. I know others who have rented in this situation.
 
Would you qualify for a mortgage for the 300k you need to trade up? Drawdown mortgage (maybe even get cashback), and repay it once the apartment sale closes. It'd also out you in a lot stronger position purchasing, as your funds aren't dependent on your sale.

It's difficult to manage closing both sales the same day as there are lots of variables. It's possible, but can be stressful.

Another option is to sell you apartment to an investor, and rent it back short term until your purchase closes.
 
Two friends of mine traded up recently in this scenario. One managed to close both same day, the other hit a snag and had to book a hotel for the 2 adults + 2 kids for a night or two. I've contracts signed to make the same move happen with a closing date set in mid January. Closing date for both is the same day, have to hope it will work out while planning for any delays to might crop up. Will have 2 kids a dog and a truck full of belongings to house if any delays do materialise!
 
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