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Hawthorne's position in Los Angeles County creates unique timing challenges for property buyers and sellers. Bridge loans provide short-term financing when you need to move quickly on a new purchase before selling your current property.
These loans typically fund within 5-14 days, making them practical for competitive situations. The temporary nature means higher costs, but you gain flexibility during property transitions that standard mortgages cannot offer.
Bridge loans focus on equity in your current property rather than traditional income verification. Most lenders require 20-30% equity in the property you're selling and strong credit scores above 660.
Your existing property must be listed for sale or have a clear path to sale. Lenders evaluate the combined loan-to-value across both properties, typically keeping total leverage under 80%.
Exit strategy matters more than employment history. You need documentation showing how you'll repay the bridge loan, whether through the pending sale or permanent financing on the new property.
Bridge loans come from specialized lenders rather than traditional banks. These private lenders and non-QM mortgage companies understand the temporary nature and price accordingly with rates often 2-4% above conventional mortgages.
Many lenders add origination fees between 1-3% of the loan amount. The total cost seems high until you consider the alternative: losing a property purchase or carrying two mortgages simultaneously.
Working with a broker gives you access to multiple bridge lenders who compete on terms and speed. Each lender has different property type preferences and geographic focus areas within Los Angeles County.
Start the bridge loan process before listing your current property. Lenders need time to evaluate both properties and establish loan terms, even though funding moves quickly once approved.
Consider the total carrying cost including interest, fees, and maintaining two properties. Many borrowers underestimate utilities, insurance, and maintenance expenses during the overlap period.
Have backup plans ready. If your existing property takes longer to sell than expected, know whether you can refinance into permanent financing or need to adjust your strategy.
Bridge loans differ from hard money loans in purpose and structure. Hard money focuses on investment properties and renovation projects, while bridge loans specifically address timing gaps in owner-occupied transitions.
Home equity lines of credit cost less but require months to establish and may not provide sufficient funds. Bridge loans deliver larger amounts faster, though at premium pricing.
Contingent offers on new purchases seem cheaper initially. However, sellers in competitive Los Angeles markets often reject contingent offers, making bridge loans the practical path to winning properties.
Hawthorne's proximity to LAX and South Bay employment centers affects property sale timing. Understanding seasonal market patterns helps you estimate realistic sale timelines when structuring bridge financing.
Los Angeles County properties require extra attention to permit history and title issues. Lenders want clean records on both properties to minimize risk during the short bridge period.
Property insurance becomes more complex when you own two homes temporarily. Verify coverage gaps before closing on your new purchase to avoid lapses that could violate loan terms.
Most bridge loans run 6-12 months with options to extend if your property takes longer to sell. Rates vary by borrower profile and market conditions.
Some lenders require an active listing before funding. Others approve loans contingent on listing within 30 days of closing on the new property.
You typically refinance into permanent financing or extend the bridge loan for additional fees. Having this exit strategy established upfront is essential.
Most bridge loans are interest-only with payments due monthly. Some lenders offer deferred payment options where interest accrues until payoff.
Lenders typically require 20-30% equity minimum. Combined loan-to-value across both properties usually cannot exceed 80% of the properties' values.
Bridge Loans in Hawthorne