What is a bridge loan?

A bridge loan offers a “bridge” in the form of cash flow to the buyer so that they don’t hit a snag when buying and selling at the same time. This loan is meant to be short-term in nature, likely between six months and a year, and it is basically collateralized by the buyer’s current property. Given the short-term nature of a bridge loan, the interest rate tends to be higher than usual.


When it comes time to buy a home, there are numerous different mortgage options from which to choose. If you are not only buying a new property but also selling your current home, you’ll want to start out by exploring what a bridge loan is. A bridge loan is designed to help buyers purchase the home of their dreams even before they can unload their current property.



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