Bridge Loans | Buying a Home before Selling Current Home


Are you wanting to buy a new home but haven't sold you current home?  A bridge loan may be your answer.  Below is information from Peoples Bank on how bridge loans work. 


  • Bridge Loans are used to bridge the gap of equity between the house the borrower currently lives in and the one that they are purchasing in a case where the current home will not be sold prior to the closing on the new home being bought.

  • An appraisal gets done on the current home to obtain a value as well as title work done to make sure of what liens are present.  The bridge loan becomes an additional lien on the property.  So there are fees to a bridge loan.

  • The borrower can receive up to 80% of the value of the current home, minus any monies currently owed on the property.  The bank occasionally will lend up to 90% on a case by case deal.

  • The bridge loan is set up for 12 months with interest only payments due until the note is paid in full.

  • The bridge loan money is then used towards the down payment and closing costs on the new home being bought.

  • The bridge loan is closed at the title company a few days prior to closing on the new home so the funds will be available on closing day of the new home.

  • Once the current house sells, the original loan (if there is one) plus the bridge loan are paid first and then any leftover money is distributed to the borrower.


Need to know what your present home is worth?  Call or email Randy for a free home valuation.

  Realtor, Real Estate Agent, Randy Mulsow

Accredited Buyer's Representative (ABR)
Certified New Home Specialist (CNHS)
Accredited Luxury Home Specialist (ALHS)
Residential Construction Certified (RCC)
Graduate Realtor Institute (GRI)



The above information on bridge loans was provided by Lacie Walton with Peoples Bank:


Lacie Walton
Senior Vice President Mortgage Lending 
NMLS# 469782/ Peoples NMLS# 514404
Phone: (806) 687-7245 Direct: (806) 776-2088  Cell: (806) 441-8036
Fax: (806) 771-2268
Address: 5820 82nd Street, Lubbock, TX 79424