AA Legal Services: Bridging loans a last resort
www.moneynews.co.uk > Personal loans > AA Legal Services: Bridging loans a last resort
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AA Legal Services: Bridging loans a last resort
Mon 28th Jan 2008
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James Molloy, AA Legal Services product manager, claims that bridging loans "should never be considered a routine factor" in the homebuying process and "appropriate advice in individual circumstances is essential" when considering employing one.
However, he admitted that broken property chains remain a "big issue" for homebuyers, with bridging loans required in some cases to enable buyers to 'bridge' the financial gap between purchasing a new home and selling their old property.
"I suspect that we will never totally rid the market of aborted transactions and the attendant broken chains, and certainly not without reform around making the commitment to proceed legally binding earlier in the process - as in the Scottish process," Mr Molloy explained.
A broken chain occurs when someone who has agreed to purchase or sell a house pulls out, leaving others struggling to fulfil their commitments without short-term financial help. Bridging loans are designed to provide a short-term solution to the problem but attract very high interest.
Related News : Personal loans |
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Related News : AA |
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