Bridge financing
Short-term financing that helps you buy or transact before an existing property sale completes.
What it is
A bridge loan provides temporary funds — often secured against equity in a departing property — so you aren't forced to sell before you buy. It's paid off when the departing property sells or permanent financing replaces it.
How it's generally structured
Terms vary widely. Interest may be paid monthly or deferred; some lenders lend against the departing home's equity up to a limit; others tie the bridge to the new purchase. Costs typically include interest for the holding period plus origination and other fees.
When it may fit
Move-up buyers and investors who need to act on timing — securing a new property, avoiding a rent-back, or competing without a sale contingency — and who have meaningful equity to work with.
Questions to ask a professional
- How is interest handled — paid monthly, or deferred until payoff?
- How much will you lend against my departing property, and at what cost?
- How does a simultaneous new first mortgage change the structure?
What it does not mean
Bridge estimates are illustrations. Real terms, costs, and the amount available depend entirely on the lender and transaction, and carrying two properties carries real risk if a sale is delayed.