Bridge Loan

If your purchase is contingent upon the sale of another property but you don’t want the hassle of coordinating the sale/purchase transactions, and you have sufficient equity in the for-sale property, a bridge loan is one financing option that can help you bridge the financial gap between your new home purchase and old home sale.

With a bridge loan, the mortgage loan used to purchase the new home will use the old home as collateral. Typically eligible borrowers must have an income that can afford the cost of the two simultaneous mortgages. A bridge loan usually offers a six-month or one- year term, and with this type of loan the associated costs (interest, points and fees, etc.) can be higher than with a more traditional loan.

A bridge loan can be a useful tool for buyers who plan to sell but who need financial flexibility in a hot housing market – sellers don’t like contingencies based on the buyer’s ability to close on the sale of their home.

The structure of a bridge loan can vary widely. If you’re considering this type of interim financing, it’s a good idea to consult with a mortgage professional who can walk you through your options.


  • Are You Ready to Own a Home?
  • Home Buyer's Step By Step Guide
  • Evaluating Neighborhoods
  • Home Buyer Remorse
  • The Home Inspection
  • The Final Walk Through
  • What You Need to Know about Homeowner's Insurance
  • Home Ownership Pays
  • ThAT Perfect Home: Must-Haves and Wish List
  • The Purchase Offer
  • Why You Should Hire a Realtor:Buyer Benefits
  • Ship-Shape Credit: Keeping Your Finances in Shape
  • It's a Buyers' Market for Investors too
  • Financing Articles Links

  • How Much Home Can You Afford
  • Mortgage Basics
  • Adjustable Rate Mortgages
  • Bridge Loans
  • Capital Gains Tax
  • How Your Credit Score Affects Your Buying Power
  • Debt to Income Ratio
  • FHA Loan
  • Fixed Rate Mortgage
  • Good Faith Estimate (GFE)
  • PMI- Private Mortgage Insurance
  • A Pre-approved Buyer is a Serious Buyer
  • Shopping for Interest Rates
  • The Stated Income/Stated Asset LoaN