Buying your next property before your current one sells can solve a real timing problem, but bridging finance comes with its own costs and risks worth weighing carefully.
How bridging loans are typically structured
A bridging loan generally combines your existing mortgage and your new purchase into one loan, secured against both properties, until your existing property sells and the proceeds pay down the bridging debt.
Peak debt is often larger than it looks
During the bridging period, you're effectively carrying the debt on both properties at once — referred to as 'peak debt' — which can mean higher repayments or interest costs than most borrowers expect, even if only temporarily.
Selling within the expected timeframe matters
Most bridging loans are approved on the assumption your existing property will sell within a set period, often six to twelve months. If it takes longer, you may face increased repayments or pressure to sell at a lower price — worth planning for conservatively, not optimistically.
Chris Brown
Managing Director & Finance Broker at New Vision Financial Services, a credit representative under Australian Credit Licence 384704 and a member of the FBAA and AFCA. More about Chris →
Frequently asked
Do I need to have my existing property listed before applying?
Requirements vary by lender — some want your property listed or under contract, others are more flexible. Your broker can confirm what a specific lender needs.
What happens if my property doesn't sell in time?
Most lenders will discuss options, such as extending the bridging period or reassessing the sale strategy, though this can come with additional cost. It's worth having a contingency conversation before you commit.
Is bridging finance only for upgraders?
It's most commonly used by owner-occupiers upgrading or downsizing, but can also apply to investors managing timing between selling one property and settling on another.