Bridging loans
Found the next home before selling this one? Bridging finance covers the gap. It has costs worth understanding first.
How bridging finance works
The lender takes both properties as security and lends you enough to buy the new one. The total you owe while you hold both is the peak debt. When your current home sells, the proceeds pay the loan down and what remains is the end debt, which becomes your normal home loan.
Use the buying before you sell worksheet to see your own numbers.
What it costs
Many lenders add the interest to the loan during the bridging period, so you don’t make two sets of repayments. That interest compounds on the full peak debt, so a slow sale gets expensive. Lenders commonly allow up to 12 months to sell, and often less for an established home.
The risks
- Your home sells for less than planned, leaving a bigger end debt
- The sale takes longer and interest keeps building
- The end debt goes above 80% of the new home’s value and lenders mortgage insurance applies
We plan with a cautious sale price for that reason.
Alternatives to compare
- A longer settlement on the purchase, giving you time to sell
- An offer subject to the sale of your home
- Selling first with a long settlement or a rent-back
- A deposit bond if only the deposit is the problem
Not every lender offers bridging loans, and policies differ on how they assess your income during the bridge.
How we handle it
The same four steps on every loan, whatever the size.
Talk
A 20-minute call about what you want to do. No documents needed yet.
Compare
Your scenario priced across 40+ banks, mutuals and non-bank lenders, explained in plain English.
Settle
We package the application, lodge it and chase the lender through to settlement.
Stay sharp
Every year we check your rate against the market, so the loyalty tax never gets a grip.
Questions people ask
Do I need to show I can afford both loans?
Some lenders assess only the end debt, others the peak debt. That difference decides who will lend to you, so we check it first.
What happens if my home doesn’t sell in time?
The lender may extend the term, charge a higher rate or, at worst, require the property to be sold. Read the terms before you sign.
General information, last updated November 2026. Scheme figures, lender policies and duty rates change, so confirm them before you rely on them.
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Let’s talk about your next move
Twenty minutes on the phone. No documents and no sales pitch.