Bridge Financing

How to bridge the gap between purchasing a new home and selling your existing property.

Don’t let buying your next home be stressful. 

Let us explain what you need to understand about a bridge mortgage.

 

Attempting to synchronize the purchase of a new property with the sale of your current home can be difficult. Each party has their own priorities and needs, and things can become complicated very quickly.

 

At Thrive Mortgage Co, we understand that you don’t need any unnecessary stress added to the real estate process. Though we may not be able to help you avoid rising prices or bidding wars, we can make the purchase process simpler, financially, with a bridge loan.

 

Are you looking for a short-term loan between your purchase and selling dates?

You can continue to leverage the equity in your home until it is sold. Bridge financing lets you make use of this equity to move into a new property before your existing home is sold. It is even possible to avoid monthly repayments by paying back the full amount after your existing property is sold.

 

Another benefit is where your new property needs some repairs or remodelling before you move in. A bridge loan allows you to complete this work in advance of moving into your new home.

Sound good?

 

Click here to apply or check out our bridge financing guide to find out exactly how you can eliminate the stress of trying to complete the purchase and sale of two properties in one day.


Bridge Financing FAQ

  • What is bridge financing?

    Bridge financing allows you to use the equity in your existing home to cover the deposit on your new home. The loan is repaid when the sale of your existing property is complete, letting you’ bridge the gap’ between the two completion dates.


  • Am I eligible for bridge financing?

    Once you have had your mortgage approved, you are eligible for a bridge loan, as long as you also have an accepted offer for your existing property. Lenders will need to know that the sale price for your existing property is enough to cover the bridge loan.

  • What are the costs?

    There are three costs involved.

     

    1) Lender fees 

    This is charged by the lender and not us. These can be from $300-600. 

     

    2) Interest

    This is based on prime + premium. Prime is currently 3.45%, premiums can range from 2-5%. For a bridge of $200,000, with a premium of 2.5% (5.95% including prime), the interest would be $32.60 for each day it is required.

     

    3) Your solicitor will add a fee for contractually arranging to have the bridge loan registered against your existing property and for it to be repaid.

    This gives the lender security, knowing that they are going to be repaid. This fee is usually around $300.

  • How long can a bridge loan last?

    Bridge loans are generally limited to 30-60 days. It is possible for an exception to be made for extended periods based on the application strength.

  • How do I receive and repay the bridge loan?

    You don’t need to worry about these at all!

    All of the logistics are taken care of by your lawyer, broker, and lender.


  • Is bridge financing available through any lender?

    Most lenders are able to provide this service, but not all. We are able to offer bridge financing options to our clients.