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If you are in the middle of selling your current home and are entering into an agreement to buy a new one, you may find that the closing dates don’t quite align. In this case, you may find a bridge loan helpful. We’ll go into greater detail about bridge loans and how they may be helpful to you.
Bridge loans are a popular financing strategy in Seattle, Washington right now. They are used by homeowners who are selling one home and buying a new one, within a fairly short time frame. This type of mortgage “bridges the gap” between selling a home and buying a new home, hence the term.
Is a bridge loan right for your purchasing situation? That will depend on your timeline, your financing needs, and your real estate goals. Contact us if you have any questions about this financing strategy, or learn more below.
Here’s what you should know about using bridge loans in Seattle, Washington.
Imagine you’ve agreed to sell your current home in Seattle, and the closing date is fast approaching. At the same time, you’ve agreed to buy another home, but it closes before the date of your current home closes. Does that mean you’ll be stuck having to pay two mortgages? Not necessarily. That’s where a bridge loan can help.
A bridge loan is a short-term home loan used by homeowners who want to purchase another home before selling their current one (in most cases). Stated differently, it allows you to close on a new home purchase before closing the sale of your existing home. It bridges the gap, financially speaking.
In Seattle, Washington, bridge loans can also be referred to as swing loans or gap financing. Interim financing is another common name for them. With all of these descriptions, the general idea is the same. The bridge loan is being used as a financing tool to bridge the gap, or interim, between buying another home and selling your current one.
Related: Home buying process in Seattle, Washington
Seattle bridge loans can vary quite a bit in terms of the structure. They are usually taken out for a few months up to a year, but they can be either longer or shorter than this. After taking out the bridge loan, the borrower will attempt to purchase another home while actively selling their current one. In many cases, the bridge loan is paid back from the proceeds earned from the sale of the home.
Sammamish Mortgage offers a unique and effective version of the bridge loan, which is ideally suited to the competitive real estate market in Seattle, Washington.
With this option, move-up home buyers can purchase a new house without having to sell the current residence until after closing. This allows you to purchase the new home without adding any contingencies into the contract (regarding the sale of your current residence). In a fast-moving real estate market like Seattle, purchase-offer contingencies could work against you. That’s why we offer this form of bridge loan financing.
Bridge loans aren’t right for every buying-and-selling scenario. But in many cases, they can be the exact right solution for homeowners who need to bridge the gap between buying a new home and selling the old one.
Do you have questions about using a bridge loan in the Seattle, Washington area? We’re here to help. Sammamish Mortgage has been serving borrowers across the Pacific Northwest since 1992. We are a family-owned mortgage company based in the Seattle metro area that provides many different mortgage programs. Please contact us if you have questions about bridge loans or any other type of mortgage financing.
Whether you’re buying a home or ready to refinance, our professionals can help.
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No Obligation and transparency 24/7. Instantly compare live rates and costs from our network of lenders across the country. Real-time accurate rates and closing costs for a variety of loan programs custom to your specific situation.