Interim loan financing seize your opportunity
An interim loan is mostly used during production of a project, such as construction of a building. Interim loan financing is a short term means of financing that gives the company funding in order to complete the project and time to find a larger and more long term type of financing once the project has been completed.
Interim loan financing is commonly utilized in real estate transactions.
Term: These loans range from 6 months to 5 years with the most typical term being 3 years.
Rate: Interest rates most often float over a defined loan index for the term of the loan and adjust or reset at maturity. In some instances the rate can be fixed.
Amortization: These loans are primarily interest only and do not amortize over the loan term.
Prepayment Penalties: Yes, however, some programs will waive fees if converted into permanent financing (which is usually the case).
An interim loan can give you a stronger negotiating position and you can purchase a property without a contingency on the sale of your existing property.