A bridge loan is convenience, sold by the month.
It lets you buy the next house before selling this one. It also has you carrying two mortgages and an interest-only bridge at 10.5% — $7,990 a month, every month, until the old house sells. That is not a criticism. It is a price, and somebody should quote it to you.
A bridge loan lets you borrow against the equity in your current home to buy the next one before the first has sold. It solves a real problem — in a competitive market a contingent offer is often simply ignored. The cost is that you carry both properties at once. On a typical Bay Area move (a $1.4M home with $600,000 still owed, buying at $1.6M with a $400,000 bridge at 10.5% interest-only), the extra monthly burn is about $7,990 — old mortgage, old taxes and insurance, plus bridge interest — on top of the new mortgage you would have paid anyway. Add roughly 2 points up front. If the old house takes six months to sell, the bridge has cost about $55,939. Selling first and renting for the same six months costs about $45,000. The bridge is a convenience premium. That is entirely legitimate — but it should be quoted to you as one.
What you burn, every month it doesn’t sell.
Two mortgages and a bridge, running at once. This is what that actually costs — and what it costs if the old house sits.
Be pessimistic. Everyone assumes two months. The bridge only hurts if you are wrong.
The route nobody prices for you. We price it.
On top of the new mortgage you'd have paid anyway.
If the old house takes 6 months, the bridge costs $55,939. Selling first and renting costs $45,000. The difference is what the convenience is worth to you.
Every month it doesn’t sell, this is what it costs.
Each slab is a month of carrying two properties. Drag the months slider and watch the stack grow. The teal line is what selling first would have cost over the same period.
If the convenience is worth the difference — take the bridge, and we’ll place it well. Just make the trade knowing the price.
Illustrative only. Bridge loans are short-term — commonly 6 to 12 months — and typically interest-only with 1.5 to 3 points up front. If your current home has not sold by the end of the term you must extend (at a cost), refinance, or face default; plan for that possibility before you sign, not after. Rates, points and maximum combined loan-to-value vary sharply by lender. Moving costs and rental assumptions in the comparison are estimates. Not a commitment to lend. Equal Housing Opportunity.
Should you just sell first?
There are three ways to buy the next house. Two of them are cheaper than a bridge, and both have a real cost of their own. Here they are, priced.
A contingent offer costs nothing and is frequently ignored in a hot market. That is the entire reason bridge loans exist — and the entire reason they can charge for it.
You have told us you would probably lose the new house if you had to wait — and that is exactly what a bridge is for. It buys certainty, and certainty has a price.
That price is $10,939 over selling first. If the house is genuinely rare, that is a rational thing to pay and we will place the loan well.
Two conditions before you do: be able to absorb the burn for twice as long as you expect, and know the cost of an extension before you sign, not after.
From here to the keys — five steps.
No mystery, no call centre, no "we'll get back to you." Every step is exactly what happens inside it.
Four questions. No credit pull, no sign-up, no obligation.
~60 secondsWhat happensOne application goes to dozens of wholesale lenders. They compete for you.
Same dayWhat happensUnderwritten against real documents — not a soft letter any lender prints.
~24 hoursWhat happensListing agents call Adriana. She picks up. That is worth more than a bid.
Your timelineWhat happensConditions cleared, docs signed, funded. And she prices selling-first against the bridge — the route we earn nothing on.
To the dateWhat happensThree moves. One should have sold first.
Real numbers, real verdicts.
The old house sat. The bridge term expired. He extended twice, at a cost, and burned $96,000.
She lost one house she liked. She bought a better one, and kept the difference.
A contingent offer would have been binned. He paid $41,000 for certainty and would do it again.
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Everything people actually ask.
What is a bridge loan?
A short-term loan — usually 6 to 12 months — secured against the equity in your current home, letting you fund the purchase of the next one before the first has sold. It is almost always interest-only and typically carries 1.5 to 3 points up front.
How much does a bridge loan really cost?
Far more than the rate implies, because the rate is not the main cost — carrying two properties is. On a typical Bay Area move you are looking at roughly $7,990 a month in extra burn (the old mortgage, the old taxes and insurance, and the bridge interest) plus about 2 points up front. If the old house takes six months to sell, that is around $55,939.
Is it cheaper to sell first and rent?
Usually, yes — often by ten to thirty thousand dollars. Selling first and renting for six months might cost $45,000 including two moves, against $55,939 for the bridge. What selling first costs you is certainty: you may lose the house you want. That is the trade, and it is a legitimate one to make in either direction — as long as somebody has actually priced it for you.
What happens if my house doesn't sell before the bridge term ends?
This is the risk nobody dwells on. You must extend (at a cost), refinance into something longer, or face default. Extensions are usually available and usually expensive. Before you sign, ask exactly what an extension costs and put that number in your plan — not in your optimism.
What is a contingent offer, and why doesn't it work?
An offer to buy conditional on your current home selling. It costs nothing and protects you completely — and in a competitive market a seller with three clean offers will very often bin it without a second thought. That gap is precisely the market that bridge loans serve, and precisely why they can charge for it.
How much equity do I need?
Most bridge lenders will go to roughly 80% combined loan-to-value on your current home. On a $1.4M home with $600,000 owed, that means around $520,000 of accessible equity. The more equity you have, the more flexible the terms and the calmer the whole exercise becomes.
Can I use a HELOC instead of a bridge loan?
Sometimes, and it is often cheaper — but you generally need it opened before you list the property, because most lenders will not open a HELOC on a home that is on the market. If you are considering a move in the next year, open the HELOC now while you still can. This is a genuinely valuable piece of timing that almost nobody is told.
Should I ever take a bridge loan?
Yes — when the house you are buying is genuinely rare, when a contingent offer would certainly be rejected, and when you can comfortably absorb the burn for twice as long as you expect to need it. Those three conditions together justify the premium. Any two of them do not.
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