Bridge Loan


  • A loan that "bridges" the gap between the purchase of a new home and the sale of a current or existing home. The current home is used as collateral and the bridge loan is used to pay closing on the new home before the current home is sold. Some bridge loans are structured to completely pay off the existing mortgage at the bridge loan's closing, while other variations of the loan add the new debt to the old debt. Bridge loans usually come with six month terms.

short-term, financing

Related Terms and Acronyms

  • Bridge Financing Definition,
    • A short-term, high interest loan that allows a seller to purchase a new property before selling an existing property.
  • Commercial Mortgage Definition, Very Important,
    • A mortgage for commercial property.
  • End Loan Definition,
    • The final mortgage on a property, as opposed to a construction or other interim loan.
  • Loan Definition,
    • Letting another party use something of value temporarily.
  • Mortgage (mtg) Abbreviation, Important,
    • A mortgage is a contract stipulating a specific real property, typically a residence or building, as collateral for a loan. The mortgage incurs a rate of interest that varies according to term and other features.
  • Open Mortgage Definition, Important,
    • A mortgage that can be paid off prior to maturity without penalty.
  • Operating Loan Definition,
    • A loan intended for short-term financing, supplying cash flow support or to cover day-to-day operating expenses.
  • Secured Loan Definition,
    • Borrowed money that is backed by collateral.
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