Bridge Loan Calculator: Buy Before You Sell
A bridge loan lets you use the equity in the property you're selling to buy the next one before the sale closes. It solves a timing problem, but it isn't cheap. This bridge loan calculator shows how much you can borrow, what it costs each month and in total, and how much cash you'll have left once your current property sells.
Bridge loan calculator
Estimate only: lenders differ in limits, fees and whether they pay off your existing mortgage. Your new home's mortgage payment is not included.
What is a bridge loan?
A bridge loan is a short-term loan, usually for a few months up to about a year, secured by the property you're selling. You use it for the down payment and closing costs on the next purchase, then repay it in full from the sale proceeds. Homeowners use it to buy before they sell; investors use it to move quickly on a new deal while capital is tied up in another property.
Most bridge loans are interest-only, and some let you defer the interest until the sale. Either way, the whole balance is repaid in one lump sum, a balloon payment.
How the bridge loan calculator works
1. How much you need
Down payment plus closing costs on the new property: 20% of $550,000 plus $12,000 = $122,000.
2. How much you can borrow
The lender's limit on the property you're selling, minus your existing mortgage: 80% × $450,000 − $200,000 = $160,000. The loan is the smaller of what you need and this limit: $122,000.
3. What it costs
Monthly interest = $122,000 × 9.5% ÷ 12 = $966. Over 6 months that's $5,795, plus a 2% origination fee of $2,440: $8,235 in total.
4. What's left after the sale
Sale price minus 7% selling costs, your mortgage and the bridge loan: $450,000 − $31,500 − $200,000 − $122,000 = $96,500.
Time is the real cost
Because you pay interest every month the loan is open, how fast your property sells matters more than the rate:
| Months to sell | Interest | Total cost with fee |
|---|---|---|
| 3 | $2,898 | $5,338 |
| 6 | $5,795 | $8,235 |
| 12 | $11,590 | $14,030 |
Price your current property to sell, and check the loan's term and extension fees before you sign.
Bridge loan alternatives
| Option | How it works | Watch out for |
|---|---|---|
| Home equity line of credit (HELOC) | Borrow against your current home, often at a lower rate | Usually must be set up before you list the home |
| Home equity loan | Lump sum against your equity, fixed payments | Payments start right away; closing costs |
| Sale contingency | Your offer depends on selling first | Weaker offer in a competitive market |
| Sell first, rent back | Sell, then rent your old home for a short time | Needs a buyer who agrees |
| Hard money loan | For investors: short-term loan on the new property itself | Higher rates and points |
Is a bridge loan a good idea?
It can be when the market is competitive and a contingent offer would lose, you have plenty of equity, and your current property is likely to sell quickly. It is risky when the sale could drag on or the price could fall: you may end up paying two mortgages plus bridge interest. Run the calculator with a slower sale and a lower price before deciding.
Frequently Asked Questions
How much can you borrow with a bridge loan?
Lenders commonly allow up to about 80% of your current property's value minus what you still owe on it, though some look at the combined value of both properties. Your credit, income and the lender's own rules decide the final amount.
How is a bridge loan payment calculated?
Most bridge loans are interest-only, so the monthly payment is the loan amount times the annual rate, divided by 12. Some lenders let you defer the interest and pay it, with the principal, when your property sells.
How long does a bridge loan last?
Typically a few months up to about a year. If your property hasn't sold by the end of the term you may need an extension, which usually costs extra.
Are bridge loans more expensive than mortgages?
Yes. They usually carry a higher interest rate than a standard mortgage plus origination fees, because they are short-term and the lender's risk depends on your sale.
What happens if my house doesn't sell?
You keep paying the bridge loan and your existing mortgage, and at the end of the term you must repay or extend. That is the main risk, so plan for a slower sale than you expect.
Sources
- CFPB: what is a balloon payment?
- Bridge loan limits, terms and fees as commonly described by U.S. lenders in 2026; always confirm with your lender.