You’re ready for your next home. There’s just one problem: you still own your current one.
For many homeowners, buying and selling at the same time can feel like a complicated balancing act. Do you sell first and risk having nowhere to go? Buy first and potentially carry two homes? Make an offer contingent on selling your current home?
And what if the money you need for your next down payment is tied up in the equity of the home you haven’t sold yet?
The good news? You may have more options than you think. One financing solution worth exploring is a bridge loan*, which could help you buy your next home before selling your current one.
Why Is Buying and Selling a Home at the Same Time So Tricky?
In a perfect world, you’d sell your current home, receive the proceeds and use that money toward your next purchase, all with perfectly coordinated timing.
But real estate rarely works that neatly.
You might find your dream home before your current home sells. Your buyer’s closing could be delayed. Or you may not want to list your current home until you know where you’re going next.
That can create both financial and logistical pressure, especially if much of your available cash is tied up in your current home’s equity.
Before assuming you have to sell first, it’s worth exploring your financing options.
What Is a Bridge Loan and How Does It Work?
A bridge loan is short-term financing designed to help qualified homeowners bridge the financial gap between their current home and their next one.
Depending on your situation, a bridge loan may allow you to access funds using the equity in your current home before it sells. You could potentially use those funds toward the down payment or closing costs on your next home.
That can give you something incredibly valuable when you’re trying to coordinate two transactions: more flexibility.
Instead of waiting for your current home to sell before moving forward, you may be able to purchase your next home sooner.
Could a Bridge Loan Help You Make a Stronger Offer?
When buying a home, the terms of your offer can matter just as much as the price.
If you need the proceeds from your current home to purchase your next one, you might make an offer contingent on selling your existing property first. While sale contingencies can be useful, they can also make an offer less attractive to sellers, especially in a competitive market.
If bridge financing allows you to purchase without selling your current home first, you may be able to make an offer without a home-sale contingency.
That doesn’t guarantee your offer will be accepted, but it can remove one potential hurdle and give sellers greater confidence in your ability to close.
More Flexibility. Less Moving Stress.
The potential benefits of a bridge loan go beyond financing.
Buying before you sell could give you time to move into your new home before listing or closing on your old one. That means less pressure to coordinate moving trucks, closing dates and possession deadlines all at once.
It could also give you more time to prepare your current home for sale, whether that means making repairs, tackling a few updates or simply keeping it clean and ready for showings without living there.
For many homeowners, that extra breathing room can make a big difference.
Is a Bridge Loan Right for You?
A bridge loan isn’t the right solution for everyone. Because it’s short-term financing, there are costs, repayment terms and qualification requirements to consider. You may also need to manage payments on multiple loans until your current home sells.
That’s why it’s important to look at your entire buying and selling timeline, not just one part of the transaction.
A PrimeLending loan officer can help you evaluate your options based on factors such as:
- Your current mortgage balance and available home equity
- Estimated proceeds from selling your existing home
- Your budget and financing needs for your next home
- Your expected buying and selling timeline
- Potential loan costs, monthly payments and repayment obligations
A bridge loan may be a smart way to make your next move, or another financing strategy may be a better fit.
The important thing is understanding your options before making a decision.
Ready to Make Your Next Move?
You don’t have to figure out the buying-and-selling balancing act on your own.
Whether you’ve already found your next home or are just starting to explore what’s possible, a PrimeLending loan officer can help you talk through your timeline, compare financing options and find a path forward.
*All credit decisions for brokered products will be made by a third party. Restrictions and limitations apply.
