Straight answers on equity, occupancy, eligible and ineligible states, appraisals, title, lien position, and both-property exceptions.
What is a bridge loan?
A bridge loan is short-term financing designed to help homeowners access equity from their existing home before it sells.
Why would I use a bridge loan?
The most common reason is to access money for the down payment and closing costs on your next home before your current home sells.
Is the bridge loan secured by my current home?
Yes. The program is generally secured by the departing residence and may be structured as a first or second lien.
How much can I borrow?
Current bridge loan amounts range from $50,000 to $500,000, subject to qualification.
How much equity can I access?
The maximum loan-to-value is generally 80%, subject to your existing liens and specific transaction.
What credit score do I need?
The current program requires a minimum 700 FICO score.
How long is the bridge loan?
The program is structured as a 6-month balloon loan.
Are the payments interest-only?
Yes. The bridge loan has interest-only payments during its short-term period.
When do I repay the bridge loan?
It is typically repaid when the current home sells or through another approved repayment strategy.
What if my home doesn’t sell within six months?
Extensions may be available subject to approval, program requirements and applicable fees. The current program allows extensions of up to four additional months.
Do I need to qualify for both homes?
Yes. Your qualification generally considers the bridge loan payment, existing housing expenses, new housing expenses and your other monthly debts.
What is the maximum debt-to-income ratio?
The current program generally allows a maximum 45% DTI.
Can I use a bridge loan for a second home?
Yes. Qualifying primary and secondary residences are permitted.
Can I use a bridge loan for an investment property?
The current program documents only primary and secondary residences as eligible occupancy types. Investment property is not in the current program.
What property types qualify?
Eligible properties currently include single-family residences and townhomes.
Which states are eligible for a bridge loan?
The current program is available in Arizona, Colorado, Delaware, Florida, Indiana, Kentucky, Massachusetts, Minnesota, North Carolina, New Hampshire, New Jersey, South Carolina, Washington and Wisconsin. We’ll confirm whether your current home and next purchase are in eligible states before you apply.
Which states are ineligible for a bridge loan?
The current program is not available in Alabama, Alaska, Arkansas, California, Connecticut, Georgia, Hawaii, Idaho, Illinois, Iowa, Kansas, Louisiana, Maine, Maryland, Michigan, Mississippi, Missouri, Montana, Nebraska, Nevada, New Mexico, New York, North Dakota, Ohio, Oklahoma, Oregon, Pennsylvania, Rhode Island, South Dakota, Tennessee, Texas, Utah, Vermont, Virginia, West Virginia or Wyoming. Availability is based on property location and may change.
Do I need an appraisal?
A full appraisal is generally required. Reduced appraisal requirements may be available by exception for certain lower-LTV transactions.
Is title insurance required?
Lender’s title insurance is required on bridge loans of $100,000 or more and on purchase transactions. Different title documentation may be permitted in certain smaller transactions.
Can the bridge loan be a second mortgage?
Yes. The bridge loan may be in first or second lien position.
Can I get bridge loans against both properties?
Potentially, but simultaneous bridge financing on both the departing and new residence requires an exception and additional risk review.
Does a bridge loan mean I don’t have to sell my existing home?
No. This program is designed around a clear exit strategy, typically selling the departing residence and paying off the bridge loan from the proceeds.