This week, during almost every conversation with Realtor partners, the topic of bridge financing came up. Many Realtors are working with buyers who want to avoid the hassle of moving twice or dealing with the uncertainty of a contingency offer. Fortunately, as a broker, I can offer a variety of “buy before you sell” solutions to meet these needs.
Bridge Loans
A bridge loan is a short-term financing option that lets buyers tap into the equity of their current home to fund the purchase of a new one. Typically, bridge loans are interest-only, with deferred payments until the home is sold. The main advantage is that it provides immediate access to home equity while allowing the buyer to exclude payments on their current property when qualifying for the new home.
Guaranteed Home Offer
This program works similarly to a bridge loan but provides buyers with a guaranteed backup offer on their home. It’s perfect for buyers who are concerned about owning two properties. With this program, the borrower can list their current home with an agent of their choice and has up to 120 days to sell.
Specialty Loan
This option is ideal for buyers who have cash for a down payment on a new home but may need assistance qualifying for two loans while they await the sale of their current property. It’s also a great fit for clients looking to avoid the costs of bridge financing and only need temporary financial support.
Home Equity Line of Credit (HELOC)
For some clients, taking out a home equity loan to fund the purchase of a new home might be a more attractive option. This is a strong choice if they plan to keep their current property as an investment. Additionally, HELOCs can be funded quickly—sometimes in as little as five days—making it an ideal solution when time is of the essence.
As you can see, there are several ways to assist clients in managing their transition from one home to another. That’s where partnering with a broker like me comes in handy. I can help buyers explore all of their options and select the one that aligns best with their financial goals.
Give me a call today to learn more!
