Bridge Loans

PROGRAM OVERVIEW

Bridge loans are short-term financing solutions designed to help homeowners purchase a new property before their current home has sold. If you have found your dream home but have not yet closed on the sale of your existing property, a bridge loan provides the funds you need to act quickly and avoid losing the opportunity.

A bridge loan typically uses the equity in your current home as collateral. The loan covers the down payment and potentially the full purchase price of the new home, allowing you to make a strong, non-contingent offer — a significant advantage in competitive markets. Once your existing home sells, you use the proceeds to pay off the bridge loan. Terms are usually 6 to 12 months, giving you adequate time to sell your current property.

At Xpert Home Lending, our bridge loan program offers fast approvals and flexible terms to help you navigate the timing challenge of buying and selling simultaneously. We understand the stress of coordinating two transactions, and our team works to ensure the financing piece is smooth and predictable. Bridge loans are available for primary residences and can be structured as stand-alone loans or in combination with a traditional mortgage on the new property.

COMMON QUESTIONS

Bridge Loans FAQ

How does a bridge loan work?

A bridge loan provides temporary financing secured by your current home's equity. You use the funds to purchase your new home, then repay the bridge loan when your existing home sells. Some bridge loans require interest-only payments during the term, while others allow you to defer all payments until the property sells. The typical term is 6-12 months.

What are the costs of a bridge loan?

Bridge loans typically carry higher interest rates than traditional mortgages, usually in the range of 8-12%. There are also origination fees (typically 1-3% of the loan amount), closing costs, and potentially an appraisal fee. While the costs are higher than a conventional mortgage, the loan is short-term, and the total interest paid over 6-12 months is manageable for most borrowers.

What happens if my current home does not sell?

This is the primary risk of a bridge loan. If your home does not sell within the loan term, you may need to extend the bridge loan (usually possible with additional fees), reduce your asking price to accelerate the sale, or refinance the bridge loan into a longer-term solution. Before approving a bridge loan, lenders evaluate the marketability of your current home to minimize this risk.

How much can I borrow with a bridge loan?

Bridge loan amounts are based on the equity in your current home. Most lenders will allow you to borrow up to 80% of the combined value of both properties, minus any existing mortgage balance. For example, if your current home is worth $400,000 and you owe $200,000, you could potentially borrow up to $120,000 for the bridge.

Can I make an offer without a sale contingency using a bridge loan?

Yes, this is one of the primary advantages. With bridge financing in place, you can make a non-contingent offer on your new home, which makes your offer significantly more competitive. Sellers prefer non-contingent offers because they eliminate the risk of the deal falling through due to the buyer's home not selling. In a competitive market, this can be the difference between winning and losing the home.

NEXT STEPS

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