Bridge financing solves a common real estate timing problem: you want to buy your new home before your current one sells. This guide explains how bridge loans work, what they cost, and when they make sense.
What Is Bridge Financing?
A bridge loan is short-term financing that "bridges" the gap between buying your new home and receiving funds from selling your current one.
How It Works
Timeline example:
How to Protect Yourself
- Don't remove conditions on purchase until sale is firm
- Build buffer into bridge amount
- Have backup financing plan
- Work with experienced real estate lawyer
FAQ
Q: Can I get bridge financing if my sale is still conditional?
A: Usually no—lenders require a firm, unconditional sale before providing bridge financing.
Q: What if my sale closes late?
A: You may be able to extend the bridge loan, but interest continues to accrue. Delays are expensive.
Q: Is bridge financing available for investment properties?
A: Yes, though requirements may be stricter and rates higher.
Q: Can I use bridge financing for a down payment on a pre-construction condo?
A: Typically no—bridge loans are for imminent closings, not deposits years in advance.
Q: What's the maximum bridge financing term?
A: Usually 90-120 days. Longer terms may require alternative financing.
What's Next
Planning a purchase before your sale closes? Talk to our team early—we'll help you structure the timing and financing to minimize bridge costs.
Plan Your Transition
We'll help you structure purchase and sale timing to minimize bridge financing costs.
