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Post 1 - What is a bridging loan? 

Ever wondered how people manage to buy a new home before they've sold their old one? The answer is often a bridging loan. 

A bridging loan is a short-term finance option (usually up to 12 months) that covers the cash flow gap between buying a new property and selling your existing one. 

It can be a great solution if you: 

• Want to buy before you sell  

• Could struggle to meet mortgage repayments on two properties at the same time 

• Want to take your time to sell your property 

• Need to use the equity in your current home to afford your new one  

• Want to avoid the hassle and expense of moving into temporary accommodation if you sell your current home before buying your new one.  

Talk to us to learn more about the bridging loan options we have available to power your next move. 

Post 2 - Buy or sell first.

If you're considering making your next property move, it’s time to start thinking about your finance options.  

Here’s a breakdown of the most common next steps: 

Option 1: Sell First  
This is often seen as the less risky option as you then have a clear budget for your next purchase. However, if you can’t find a new home quickly, you might need to find temporary accommodation. And, if you don’t purchase quickly, you could be priced out of a rising market.  

Option 2: Buy First
You can take your time finding the perfect property at the right price, but you will need to be able to cover your existing mortgage and the mortgage on the new property until you sell your old home. This situation can result in sellers feeling pressured to sell their home more quickly.   

Option 3: Simultaneous Settlement
When you line up the settlement dates for the property you’re selling and the property you’re buying. The funds from the sale of your current home are immediately put towards the purchase of your new home. However, this can be complicated to arrange and stressful if settlement falls through.  

OR ... Secure a bridging loan. This option allows you to cover the cash flow gap between buying and selling a property. Bridging finance is ideal for those who want to buy before they sell and take their time to look for their next home. 

We can access a variety of bridging loans through our lender panel, and can provide you with a tailored comparison of the pros, cons and financial implications of your different options to help you power your next move. 

Post 3 - How does a bridging loan work?

A bridging loan may sound complicated, but with the right product and a broker by your side, the process can be seamless and straightforward.  

Here’s a simple breakdown of how a bridging loan works: 

1. The lender takes over your existing mortgage and provides the finances you need to buy or build your new home. The total amount they lend you (including your existing mortgage) is called your ‘peak debt’.  

2. You make interest-only repayments on the peak debt, or your lender may allow you to add the interest payments to your peak debt instead. 

3. When you sell your property, the sale proceeds are deducted from your peak debt. Your bridging loan then converts to a standard home loan. 

Talk to us today to power your next move.

Post 4 - Top tips when considering a bridging loan.

Bridging loans can be a great option to secure your next move, but it’s important to go in with a clear strategy.  

Here are the top tips to consider when applying for a bridging loan: ⬇️ 

Pay interest as you go: Some lenders let you add interest repayments to your 'peak debt' rather than paying interest during the loan period. While this can help with cash flow management, it also increases your balance each month (and you'll pay interest on that new, higher amount). Paying the interest as you go keeps your peak debt from growing. 

Avoid LMI: Try to keep your 'end debt' under 80% of your new home's value to avoid paying Lender’s Mortgage Insurance (LMI). 

Watch the clock: Bridging loans are short-term, usually 6 to 12 months. List your home as soon as you can to avoid exceeding the timeframe. 

Talk to a broker: We can guide you through the bridging loan process. We’ll walk you through your options and help you power your next move with confidence. 

Post 5 - Making your next property move.

Are you... 

• Moving – for whatever reason? 

• Downsizing for a simpler lifestyle? 

• Relocating for a sea-change or tree-change? 

• Building your dream home? 

If so, you may be facing the ‘buy or sell first’ dilemma, and a bridging loan could help you navigate this change. 

Mortgage Choice has access to a range of tailored bridging loan solutions, helping you power your next move with ease. 

We can even complete a detailed, side-by-side comparison of your options (buy first, sell first, keep both, settle same day) to ensure you can make your next move with confidence.  

Talk to us today to power your next move.  

Post 6 - Power your next move.

If you’re thinking of making your next property move, Mortgage Choice can help. 

Our sophisticated digital tools include bridging loan affordability calculators, and side-by-side comparisons of your options when buying and selling property, powered by real-time property and suburb insights to help inform your next purchase. 

Talk to us today.