What is Bridge Financing?

Bridge financing is typically a process of when you're selling and buying a new home at the same time.

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Mortgage banks, lenders, and mortgage brokers understand that when you are selling a home, the closing dates sometimes extend pass the date of when you are purchasing. Without bridge financing, typically this places you in bit of a bind because when you sell your home, your must set your closing date at the same time as your purchasing date.

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What the banks do is lend you the money for the next purchase of the home.

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For example:

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You sell your home for 100k and you owe 50k and the next home your buying is 200k and you're putting 50k as down payment. The lenders and banks typically lend you the mortgage of 150k plus an additional 50k which is called bridge until your home has closed. Lenders usually have rules like the home must be firm sold or firm offer (meaning that you have an offer from a buyer and without any conditions)

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There are other forms of bridge financing. For more info please contact one of our qualified and experienced mortgage brokers.