4 things to consider when using a bridging loan to help you relocate

Last updated on November 25th, 2021 at 10:46 am by Bill Tsouvalas

Planning a move might seem straightforward in the mind. However, if you sat down and set a budget you will soon realise that moving could cost you anything between $550 to $3,500 for a removalist alone. This is where a relocation loan, also known as a bridging loan, can come in handy. Here are seven things to consider when taking out a bridging loan.

Calculating the costs

Before you even consider taking out a loan you will need to consider the costs of your move. Having a budget in place will help you know how much is needed and where you can cut down costs by doing a few things yourself. This means looking at expenses such as:

  • Hiring a mover can cost you up to $3,655
  • Renting a truck can cost you $782
  • Renting or purchasing your new apartment
  • Paying for storing and lodging

Taking out a loan you will be able to pay off

Relocating can be a bittersweet moment as this means you are starting off a new chapter in a new building you will have to adjust to. But things can soon turn bitter if you bite off more than you can chew in terms of your loan.

If you are on shoestring budget you might want to check that you will be able to comfortably afford the loans repayments. Checking to see if you will be able to pay off your loan by looking at its features such as flexibility when it comes to repayments, its ongoing costs, fees, charges, along with the APR and interest rate.

You are entering a higher pay bracket

People have various reasons for relocating and even more so when they are taking out a personal loan. It is vital that you carefully assess the reasons as to why you are taking out a personal loan to help you relocate. It might be tricky if you are just starting out, but if you are moving to a job that offers a higher pay bracket it can help you pay off your loan on time. This will also decrease your chances of falling into arrears which could end up costing you.

You can get a good interest rate

It is possible to get a competitively low rate for your personal loan if you have a good credit score and you compare your loans instead of settling for the first good deal that comes your way. If you do not have a good credit score you will not be excluded from getting a rate that is suitable for your financial situation.

Speaking to a broker or a lender about what options are available for you will help you find an option that is financially sound and flexible for you.

You don’t have to miss out on a good deal. Instead of waiting for your current property to sell you can move with ease into your new place with a bridging loan.

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