ServicesBridge Loans
Bridge Loans in Manor
A bridge loan lets you buy the next place before the current one sells. We size it from your existing equity, map the payoff to your expected sale date, and line up the permanent home loan so the two closings fit together.
What a bridge loan does, and when it fits
A bridge loan is short-term financing secured by the property you already own. It pulls equity out before the sale so you have a down payment, and sometimes closing costs, for the purchase. When the old property sells, the sale proceeds pay off the bridge loan and any existing mortgage on it.
It makes sense when your equity is real but locked up, and the timing of a sale would cost you the house you want. It often helps buyers moving up within the Austin area who need to make a non-contingent offer. It is the wrong tool if the old property is unlikely to sell soon, or if carrying two payments for a few months would strain your budget. We tell you which side of that line you are on.
Most of the risk in a bridge loan sits in small details: how the existing lien gets paid off, whether payments are deferred, and what happens if the sale runs late. We work those out on paper before you sign anything.
What we set up for you
- An equity and payoff worksheet
- We start from a payoff figure on your current mortgage, not an estimate from memory. Then we subtract expected selling costs from a realistic sale price to see how much equity can safely be borrowed against.
- Payment structure that matches your cash flow
- Some bridge loans carry interest-only payments, and some defer payments until the sale. We explain how each option affects the total cost and your monthly budget while you hold both properties.
- A coordinated permanent loan
- The bridge loan only covers the gap. We arrange the long-term home loan on the new property at the same time, usually a conventional loan, and check that its underwriting counts the bridge payment correctly in your debt-to-income ratio.
- A written exit plan
- We note the loan term, the target listing date, and what happens if the sale takes longer than expected. You know the extension terms or fallback before closing, not after.
- Closing-date alignment
- We coordinate with the title company and both agents so the bridge funds are available when the purchase needs them, and so the payoff instructions are ready for the sale.
Signs a bridge loan may be the right move
Sellers won't accept a sale contingency
In a competitive listing, an offer that depends on selling your current place often loses. Bridge financing lets you write a cleaner offer.
Your down payment is tied up in equity
You have substantial equity but little cash in savings. A bridge loan turns that equity into a usable down payment without waiting for the sale.
You want to move only once
Selling first can mean a rental, storage and a second move. Buying first lets you move straight into the new place, then list the empty one.
An empty house shows better
Vacant, cleaned and staged properties are easier to show and photograph. Some sellers gain more from that than the bridge loan costs.
The new place is under construction
New builds often finish on a builder's schedule, not yours. A short bridge can cover the overlap if your sale and the builder's completion date don't line up.
What moves the cost of a bridge loan
Bridge loans usually carry a higher rate than a standard home loan because they are short and secured by a property about to change hands. Your actual cost depends on a few specific inputs, and we show each one in a written breakdown. Short holding periods keep the total down.
How much equity you have
The more equity left after the bridge is drawn, the lower the risk to the lender. A thin cushion generally means a higher rate or a smaller loan.
Length of the bridge
Interest accrues every month the old property stays unsold. A realistic list price and a ready-to-show property often matter more than the rate.
Payment structure
Deferred payments help cash flow but add accrued interest to the payoff. Interest-only payments cost more month to month and less at the end.
Origination and closing charges
Bridge loans have their own fees, title work and recording costs, in addition to the permanent loan. We list them line by line so you can compare them with the cost of selling first.
Credit and debt-to-income
Your credit score and the ratio of total debt to income affect both the bridge rate and approval on the permanent loan.
How the process runs
- 1
Pre-qualification call
A loan officer reviews your current mortgage balance, income, credit and the price range you're shopping in. You learn whether a bridge loan works on the numbers and roughly how much it can provide.
- 2
Documents and valuation
We collect a mortgage statement, income documents and asset statements, and order a valuation on the property you are selling. The value sets the borrowing limit, so we check it against recent comparable sales before relying on it.
- 3
Structuring both loans
We set the bridge amount, payment structure and term, then underwrite the permanent loan on the new property. Both are reviewed together so neither one surprises the other at closing.
- 4
Closing on the purchase
The bridge funds and the permanent loan close with the purchase. You get a closing disclosure that shows where every dollar of equity went.
- 5
Sale and payoff
When the old property sells, the title company pays off the bridge loan and any remaining mortgage from the proceeds. We confirm the lien releases are recorded.
Bridge loan questions
Will I have to make two mortgage payments at once?
Possibly, for a short time. Depending on the structure, you may pay the existing mortgage plus interest on the bridge, or the bridge payment may be deferred until the sale. We model both so you can see the monthly figure before you commit.
What happens if my current property doesn't sell before the bridge term ends?
That is the main risk, so we plan for it up front. We explain the extension options and their cost, and we talk honestly about price and timing before you list. If the sale outlook is shaky, we may suggest another route.
Is a bridge loan the same as a HELOC?
No. A HELOC is a revolving line of credit you can keep for years. A bridge loan is a one-time, short-term loan meant to be paid off by a specific sale. Some buyers use a HELOC instead if they open it before listing, and we compare the two with you.
Can I use a bridge loan to buy an investment property?
Bridge loans are mainly built for moving from one primary residence to the next. Investors buying or renovating properties are usually better served by hard money loans, which we cover separately.
How long does it take to close?
It depends on the valuation, your documents and the purchase contract's dates. We work back from your contract closing date and tell you early if any item could hold it up.
Find out what your equity can do for the next purchase
Tell us your current balance, the price you expect to sell for and what you are shopping for. A loan officer will run the numbers on both loans and walk you through the exit plan.