Bridging Loans
Buy before you sell with a structured Bridging Loan
Buy your next property before selling your current one with a structured bridging loan designed around your sale timeline and exit strategy.
A bridging loan provides short-term funding to “bridge the gap” between buying and selling, giving you flexibility to secure your next home or investment without rushing your sale.
At Alpha1 Financial Solutions, we compare lenders and structure tailored bridging finance around your timeline, equity, and exit plan – so you can move forward with certainty.
Bridging Loans
What is a Bridging Loan?
A bridging loan, sometimes called bridging finance, is a short-term facility that provides the funds to purchase a new property before your existing one sells. It allows you to act quickly when the right home or investment becomes available, with repayment made once your current property settles.
Bridging loans are commonly 6 to 12 months in length, interest-only, and typically priced between 6% and 8% p.a., depending on the lender and loan structure.
Buy Before You Sell
Secure your next home before your sale settles so you don’t miss the right property.
Smooth Property Transition
Avoid renting or moving twice. Move straight into your new place when it suits you.
Short-Term, Interest-Only Options
Lower repayments during the bridging period. Most loans are interest-only for 6–12 months.
Flexible Across Lenders
Independent experts compare bank and non-bank options and structure a loan around your timeline.
Who Uses Bridging Loans
When should you use a Bridging Loan?
A bridging loan may be right for you if you’re:
- Buying before selling and want to secure your next property without waiting for your current sale to settle
- Selling before buying and need short-term funds to cover the gap between transactions
- Upsizing or downsizing and want a smoother move between homes
- Relocating for work or lifestyle reasons but need extra time to settle your current property
- A property investor purchasing a new asset while another is still on the market
- Building or developing and need temporary finance until construction or sale completes
If timing your move feels complicated, bridging finance provides flexibility allowing you to act quickly in a competitive property market while your sale catches up.
HOW IT WORKS
How does a Bridging Loan work?
A bridging loan connects the gap between two transactions – your purchase and your sale. Here’s how it typically works:
Step 1: Use the equity in your current home
Your existing property is used as security to fund your next purchase, giving you access to short-term finance before your sale settles.
Step 2: Combine both loans
Your lender merges your current mortgage with the new property’s purchase cost into one short-term facility, known as peak debt.
Step 3: Repay once your property sells
When your current property settles, the sale proceeds reduce the balance to the remaining end debt, which is your ongoing home loan amount.
Because bridging loans are time-sensitive, having a clear sale and exit strategy is essential. Alpha1 Financial Solutions helps structure your bridging finance to match your timeline and minimise interest costs.
Types of Bridging Loans
Different types of Bridging Loans
Bridging loans come in two main forms, closed and open, each designed to suit different timelines and levels of certainty around your property sale.
- Closed Bridging Loan - Used when you’ve already exchanged contracts or have a confirmed settlement date for your current property. Because the repayment date is fixed, lenders view it as lower risk and often offer slightly more favourable terms.
- Open Bridging Loans - Used when your current property is still on the market or hasn’t yet sold. There’s no fixed repayment date, giving you more flexibility but lenders may require a clear exit strategy to ensure repayment once the sale is complete.
Specialists in Bridging Loans
Why choose Alpha1 Financial Solutions for Bridging Loans
When timing is everything, you need a lending partner who understands the urgency, complexity and pressure of buying and selling property.
Industry Expertise
We specialise in bridging finance and complex property transactions, comparing options across both bank and non-bank lenders.
Rapid Approval Process
Our streamlined systems and lender partnerships allow us to secure approvals in as little as 24–48 hours, helping you move quickly when the right property appears.
Tailored Lending Solutions
We structure your loan to match your settlement dates and sale plan, aligning every detail with your broader financial goals.
Support You Can Count On
From first inquiry to settlement, you’ll have a dedicated lending specialist by your side.
FAQs
FAQs About Bridging Loans
What is the difference between a closed and open bridging loan?
A closed bridging loan is used when you already have a confirmed settlement date for the sale of your current property. An open bridging loan is for when your existing property hasn’t sold yet. The latter offers more flexibility but carries higher risk and may come with stricter conditions.
How long can a bridging loan last?
Most lenders in Australia offer bridging terms of up to 12 months. This period allows time for your existing property to sell and the loan to be repaid. Longer terms are rare and may increase interest costs, so having a clear exit strategy is essential.
What happens if my property doesn’t sell within the bridging term?
If your property hasn’t sold by the end of the agreed term, lenders may extend or refinance the loan, but additional costs and interest can apply. It’s important to plan your sale timeline carefully to avoid carrying two loans for longer than expected.
Do I need a deposit for a bridging loan?
In many cases, you don’t need a cash deposit if you have enough equity in your current property. The equity is used as security to fund the purchase of the new home during the bridging period.
The information on this page is general in nature and has been prepared without taking into account your objectives, financial situation or needs. Terms, pricing and eligibility for lending products and finance solutions can vary depending on the lender, product type, borrower profile and project details. Independent professional advice is recommended before acting on this information.
