BUYING BEFORE YOU SELL, WITH THE EXIT IN VIEW
Bridging finance can help fund a purchase before the sale proceeds from your current property are available. You may carry debt against both properties for a period, so the repayment plan matters as much as the purchase.
We work through the peak debt, the expected end debt and the sale assumptions with you, and consider lender options whose bridging policy appears relevant to your position.
WHEN BRIDGING MAY BE CONSIDERED
Buying Before Selling
A lender may consider bridging when you have found the next property but have not yet sold your current one, subject to the security, repayment plan and your circumstances.
Settlement Timing Gaps
Bridging may cover a gap where your purchase settles before sale proceeds are available. The sale contract, its conditions and settlement dates still need to be reviewed.
Building a Replacement Home
Some lenders may consider bridging alongside construction finance for a replacement home. The build schedule, sale plan and both sets of lending conditions need to be considered together.
Downsizing or Upsizing
For a move to a smaller or larger home, expected sale proceeds may form part of the repayment plan. Depending on the transaction and lender, an ongoing loan may or may not remain.
Peak Debt and End Debt
Assessment may consider both the combined debt while both properties are held and the debt expected to remain once the sale completes.
The Sale Is the Exit
A sale-dependent bridging arrangement needs a realistic sale and repayment plan. If the sale is delayed or the price falls short, costs may rise and more debt may remain than expected.
WHAT SHAPES A BRIDGING ASSESSMENT
Bridging policy varies between lenders. These are some of the factors that can affect whether bridging is available and on what terms.
Valuation of Both Properties
The lender's valuations of both properties, together with existing loans and any cash contribution, can affect the borrowing and security requirements.
The Expected Sale Price
Assessment may rely on a conservative view of the sale price rather than the price hoped for, and that assumption shapes the whole arrangement.
Repayments During and After the Bridge
Lender assessment may consider repayments during the bridging period as well as any ongoing loan after the sale. Interest being added to a loan does not remove other repayment obligations.
Interest During the Bridging Period
Some bridging products add interest to the balance rather than requiring it to be paid during the bridge. That interest still has to be repaid and may itself attract interest under the loan terms.
The Bridging Period
A delayed sale can leave debt unpaid at the agreed deadline. An extension is not guaranteed, and the properties securing the lending may be at risk if required repayments are not met.
Costs on Both Sides
Purchase and sale expenses, ongoing property costs, lender fees and interest can affect the overall funding requirement. The amount available from the sale to reduce debt depends on the proceeds and relevant costs.
HOW WE APPROACH BRIDGING FINANCE
01
Map Both Positions
We review the properties, existing lending, available cash, transaction costs and intended repayment plan, including the assumptions behind the expected sale price.
02
Test the Repayment Plan
We compare relevant lender options and work through the peak debt, expected end debt and what could change if the sale takes longer or achieves less than expected.
03
Present the Application Clearly
If you choose to apply, we document both property positions and work through lender questions and conditions. If approved and you proceed, we coordinate the finance steps with your conveyancer or solicitor.
INCLUDING WHETHER TO BRIDGE AT ALL
Direct Broker Access
You deal with Christian directly through the review and, if you proceed, through the lending steps associated with the purchase and sale.
Other Pathways Considered
Selling first or negotiating different settlement dates may reduce the need for bridging, depending on the contracts and your circumstances. Where bridging does not work out, it can be expensive. We explain the lending alternatives; your conveyancer or solicitor can advise on contract terms.
Clear on the Numbers
We explain the indicative peak debt, any expected end debt, repayment requirements and the assumptions used. Those figures remain subject to lender assessment and the actual purchase and sale outcomes.
COMMON QUESTIONS ABOUT BRIDGING LOANS
What is a bridging loan?
A bridging loan can provide temporary funding for a property purchase before the sale proceeds from your current property are available. Depending on the arrangement, existing and new borrowing may be secured across both properties. Sale proceeds are then applied to the lending. An ongoing home loan may remain, or the borrowing may be repaid in full if the proceeds cover the amount due. Lender eligibility, repayment requirements, costs and the deadline for repayment vary. We explain the proposed structure and sale assumptions before you decide whether to apply.
What are peak debt and end debt?
Peak debt describes the highest combined borrowing expected during the bridging period. The estimate needs to allow for the existing debt included in the arrangement, new borrowing, financed costs and any interest added to the balance. Cash you contribute and repayments made can affect it. End debt is any amount expected to remain after the sale completes and the available proceeds are applied. It may be nil where the approved structure allows full repayment. We explain both estimates and their assumptions, rather than treating the sale price as guaranteed.
What happens if my property does not sell within the bridging period?
Do not assume the bridging period will be extended. The outcome depends on the loan contract and the lender's response to your circumstances. You may need to repay the amount due or agree another arrangement; an extension or refinance may not be available. A delayed sale can increase costs, and a lower sale price may leave more debt than planned. If the required debt cannot be repaid, the properties securing the lending may be at risk. Contact your lender and broker early if the sale or settlement timetable is slipping.
Do I make repayments during the bridging period?
Repayment requirements vary between products. Some require interest or other repayments during the bridge; others allow interest on the bridging portion to be added to the balance. That does not necessarily pause repayments on an existing or separate loan. Capitalised interest still has to be repaid and, under some loan terms, further interest accrues on the increased balance. We explain which repayments remain due, how interest is charged and what is due when the bridge ends. A payment deferral is not an interest-free period.
Can I use bridging finance when building a new home?
It can be possible where the lender accepts the combination of bridging and construction finance. The build contract, staged funding, completion assumptions and proposed sale need to be considered together. If the sale is planned after construction, a build delay can leave less time before the bridging deadline; completing the build does not itself extend that deadline. Lender policies and security requirements differ. We assess the lending arrangements together and coordinate finance-related conditions with your conveyancer or solicitor, without assuming that either facility will be available.
Is it better to sell first or buy first?
There is no single answer. Selling first may reduce the need to carry both properties but can create accommodation or settlement-timing issues. Buying first may let you proceed with the next purchase before your sale settles, but can increase debt, holding costs and exposure to a delayed or lower-priced sale. We assess and explain the lending options and repayment risks for your circumstances. Your conveyancer or solicitor should advise on contract conditions and settlement arrangements. No option guarantees the timing or price of either transaction.