More Australians are moving to regional areas, and the numbers speak for themselves. According to the Regional Movers Index, city-to-region relocations have surged by 16% compared to pre-pandemic levels. A bridging loan could be the perfect solution if you’re looking to secure a new home but haven’t sold your existing property yet.
At Ausfirst Lending Mortgage Brokers Caloundra QLD, we help you move forward without the financial stress. A bridging loan lets you purchase your next property while waiting to sell your current home. No rushed decisions. No unnecessary compromises. Just a smooth transition with expert guidance from licensed mortgage brokers who put your best interests first.
With access to bridging finance options from most lenders, we compare interest rates, early repayment fees and charges. This enables us to find a cost-effective solution that suits your personal circumstances. Our goal? To help you settle into your new home faster. Plus, with better rates and smart financial planning that saves you money.
Don’t let timing hold you back from moving into your next home. Let’s make your transition easy and stress-free. Contact us today, and let’s get started securing your bridging home loan!
Bridging loans, also called relocation loans, are short-term, specialised home loans. They essentially “bridge” the financial gap, allowing you to secure funds for your new property before selling your existing home. Typically, it’s backed by your existing property’s equity.
In this case, your current loan is merged with the loan amount for your new property, creating peak debt. Peak debt is the total temporary debt held until your property sale is finalised. This financial arrangement combines your existing mortgage with the new amount needed for your next property.
Lenders typically structure bridging finance to be repaid after selling the current home, usually within 6 to 12 months. This allows you to purchase your new property without the stress of aligning settlement dates, while managing interest rates, repayments, and any related fees.
There are two types of bridging finance options: closed bridging loans and open bridging loans. Understanding the distinctions between them can help you choose which one best suits your financial situation and property plans:
A closed bridging loan is designed for borrowers who have already secured a buyer for their existing property and have a confirmed settlement date. It’s considered lower risk by lenders, as the sale is guaranteed, often resulting in more favourable loan terms. With this arrangement, you have a clear timeline for repayment, as the proceeds from your property sale will be used to pay off the outstanding balance.
An open bridging loan is ideal if you’re ready to purchase a new property but haven’t yet secured a buyer for your existing one. Without a fixed sale date, this loan type poses a higher risk for lenders, often resulting in stricter requirements and potentially higher interest rates. To qualify for this loan, you typically need substantial equity in your current home and a well-defined plan to market and sell it, which reassures bridging loan lenders of your commitment. While this type of loan provides the flexibility to move forward with a new property purchase, it’s essential to be mindful that any delays in selling your home can lead to increased interest costs on the loan balance.
Here’s a look at some of the key benefits of bridging or relocation loans:
Bridging loans offer fast property funding, helping you acquire a new property without waiting for your current one to sell, as mentioned earlier. With this loan, you have the flexibility to act quickly on a property purchase, gaining an edge in high-demand areas.
Many bridging loans come with flexible repayment terms, often allowing for interest-only payments until your current property is sold. This structure reduces your immediate financial burden, as you’re only required to pay the interest rather than the full loan amount during the bridging period.
Some lenders also offer the option of deferred payment on your bridging loan, where the interest accrues and is added to your loan balance instead of requiring monthly repayments. You’ll then settle the accumulated interest in a single payment at the end of the loan term. This feature can be particularly beneficial if you need to prioritise cash flow for other expenses during the bridging period.
Bridging loans allow you to move into your new home without needing temporary accommodation. By bridging the gap between buying and selling, you eliminate the hassle of moving twice or incurring the costs of rental accommodation. This one-step move saves time, effort, and expense, making the transition to your new property more seamless.
With bridging finance, you can take your time selling your current property. Since you’re not in a rush to sell to fund your new purchase, you can wait for the right offer, potentially securing a higher price. This added flexibility often allows homeowners to achieve a better return on their property sales.
Real estate bridge financing allows you to continue living comfortably without the stress of relocating until your sale is complete. The stability of not having to move immediately provides convenience and peace of mind during what is typically a busy time.
While bridging loans are convenient, they come with certain risks. Understanding these can help you make thoughtful decisions and plan more effectively.
A bridging loan interest rate is often higher than that of a standard home loan due to its short-term, high-risk nature. This can significantly increase your monthly interest costs, especially if it takes longer than expected to sell your current property. As a result, it’s essential to weigh whether the convenience of a bridging loan is worth the extra interest.
Unlike standard loans, bridging loans often capitalise interest, which means unpaid interest is added to your total loan balance. This compounding effect increases the overall cost of the loan, especially if your home doesn’t sell quickly. The longer the property takes to sell, the more the interest compounds, leading to a higher debt balance by the end of the loan term.
When applying for bridging finance, you’ll need to have both your existing and new properties professionally valued. These valuations come at a cost, which can add up when factoring in other upfront fees. If you’re exploring the option of a bridging loan, it’s important to account for these expenses in your budget.
An overestimated sale price for your current property can lead to unexpected financial strain. If your home sells for a lower price than anticipated, the sale might not cover the full loan balance, possibly leaving you with more debt than planned. Having a realistic view of your property’s market value helps minimise this risk and ensures better financial preparedness.
Most bridging loans have a strict term limit, typically 6-12 months, after which they must be repaid in full. If your property doesn’t sell within this period, you may face penalties or be forced to sell under pressure. This time constraint can add stress to the process, so be sure to have a clear sales strategy and a backup plan in case of market delays.
Lenders usually require you to have a high level of equity in your existing property, often around 50% or more. This equity acts as collateral, providing security for the loan and reducing the lender’s risk. If your equity falls below this level, lenders may be less likely to approve the loan or may apply stricter conditions.
A clear and active sale plan for your current property is an essential bridging loan eligibility requirement. Most lenders require proof that your property is on the market or has an unconditional sale agreement in place. This assurance gives lenders confidence that the loan will be repaid within the bridging period, helping you secure bridging loans with better terms and easing the approval process.
Bridging loans often require proof that you can handle the additional financial responsibility, including any interest payments during the loan term. Lenders typically review your income, current expenses, and credit history to ensure you can manage repayments until the property is sold. Demonstrating financial stability may also help you secure lower bridging loan interest rates, as lenders see you as a lower-risk borrower.
Most bridging loan lenders set a maximum LVR of around 80% for bridging loans, factoring in both your current mortgage and the loan amount. The LVR helps ensure you have enough financial buffer in case of market changes or unexpected delays in selling your home.
Lenders may ask for a clear strategy detailing how you intend to repay the loan if your property takes longer to sell than expected. This could include having cost savings to cover potential shortfalls or an alternative source of income to manage payments. A solid repayment strategy can give lenders added confidence in your ability to complete the loan successfully.
Applying for bridging loans in Australia is similar to applying for traditional home loans but with a few unique requirements. Consulting with a mortgage broker can help you navigate the process, compare lenders, and find the most suitable loan structure for your needs. Here’s a step-by-step guide to applying:
Gather Necessary Documentation: Collect all required documentation to demonstrate your financial stability and readiness for the loan. Most bridging loan lenders will ask for income statements, bank account details, information on your assets and liabilities, and a signed sales agreement or proof that your current property is on the market.
Complete and Submit Your Application: Once you have your documentation in order, submit your application to the lender of your choice. Ensure all information is accurate and complete to prevent delays during the review process.
Wait for Approval and Funding: After reviewing your application, the lender will assess your financial position and may request additional information if needed. Upon approval of your loan, the lender will release the funds, typically within a few weeks.
When timing is everything, a bridging loan or relocation loan empowers you to confidently step into your next property without the pressure of immediate selling. It lets you move at your own pace, giving you control over your property journey.
You can also use a bridging loan for renovation to maximise your property’s potential before selling it. Whether you’re creating the perfect living space or increasing your property’s resale value, this financing option provides the flexibility you need to achieve your goals.
At Ausfirst Lending, our team understands the unique demands of bridging finance and is here to help you make a seamless transition. We offer personalised support to ensure your loan fits your budget, timeline, and goals, and work with you to get a quick bridging mortgage approval.
At Ausfirst Lending Group, you are our top priority. We are dedicated to providing comprehensive assistance from start to finish, not just because we are legally obligated to act in your favour, but because we genuinely want to ensure your success.
We focus on your objectives and requirements, and combine deep industry knowledge with a strong commitment to finding loan options that truly align with your financial needs. We simplify the entire loan application process by assessing your borrowing capacity, organising documentation, and negotiating terms on your behalf, all while securing the most favourable outcomes for you.
While some financial services may come with hidden fees, working with us ensures you won’t pay out of pocket for expert advice. Our service is free for you because we receive compensation directly from the lenders, allowing you to focus on finding the best loan without worrying about additional costs. We maintain transparency throughout the process, so you always know where you stand.
One of the key benefits of working with Ausfirst Lending is our access to a diverse range of lenders. Instead of presenting just one option, we assess a broad array of options to secure a loan tailored to your financial needs. This extensive selection allows us to tailor solutions that match your specific goals and circumstances, ensuring you get the best possible outcome.
Our knowledge of the property market in Brisbane is unparalleled, and we have been helping residents buy property for years. Our mortgage brokers in Brisbane aren’t just professionals; we’re local experts who understand the intricacies of the area’s property market. This local knowledge means we can provide insights and advice that are particularly relevant to your situation. Additionally, our connections in the industry may help you access special discounts or benefits, giving you an edge when securing a loan.
Ausfirst Lending Group is proud to be recognised as a finalist in the 2024 Sunshine Coast Business Awards under the Professional Services category, showcasing our commitment to excellence and dedication to serving the community with integrity and expertise.
We don’t just find you a loan that fits; we aim to get one that exceeds your expectations in terms of rates, options, and service.
We work with over 40 lenders, including big banks and non-bank lenders, giving you unparalleled mortgage choice—you have plenty of options to choose the most suitable home loan for you.
Our team is dedicated to guiding you throughout your homeownership journey, whether it’s securing your first home or an additional investment property. We provide ongoing support, including a 6-month review process to keep your loan competitive.
Every mortgage broker on our team has over 10 years of industry experience, ensuring expert advice every step of the way.
We tailor home loan solutions that prioritise your best interests, not the bank’s.
Our entire process is transparent and easy to understand, making the entire journey hassle-free.
Securing the right loan should be a personal journey, not a transaction. That's why when you choose us, you deal directly with Richard, the founder, who brings over 30 years of hands-on experience managing diverse loan projects across Queensland.
Unlike larger brokerages where you become just another file number, Richard personally oversees every client's loan process—whether you're purchasing your first home, refinancing, expanding your investment portfolio, or acquiring commercial equipment. His extensive industry knowledge ensures you receive tailored advice, a smooth application experience, and solutions that align with your long-term financial goals.
We’re not just mortgage brokers; we’re your trusted lending partners. With a commitment to transparency, accessibility, and genuine care.
In other words, you are not passed between departments—you are looked after by someone who treats your financial success as his own.
Speak to Richard Today →Whether you're buying your first home, refinancing, or exploring loan options through a trust or SMSF, we’re here to guide you every step of the way. As your trusted Mortgage Broker on the Sunshine Coast, we offer personalised advice tailored to your needs.
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Bridging finance is a temporary loan that provides the funds needed to purchase a new property before your current one is sold. It is generally secured against the equity in your existing home and is intended to “bridge” the financial gap between buying and selling. With bridging finance, you’ll maintain both your existing loan and the new loan, creating what is referred to as “peak debt,” which will be repaid once your property sale is finalised. Typically, bridging loans have a 6- to 12-month term, allowing you the flexibility to sell your home without rushing to meet strict settlement dates.
The cost of bridging loans depends on several factors, including the lender, applicable interest rate, and the loan-to-value ratio (LVR). Because bridging loans are short-term and considered higher risk, their interest rates are typically higher than those of standard mortgages. Additional expenses, such as valuation fees and broker charges, can also add to the total bridging loan cost. When planning your budget, it’s important to consider how long it may take to sell your current property, as extended loan periods can increase the interest on your peak debt.
Most lenders require at least 50% equity in your current property to qualify for a bridging loan. This equity acts as security for the loan, helping reduce the lender’s risk. Higher equity levels can also help you access better loan terms, so knowing your property’s value and the outstanding mortgage balance is essential when applying.
Bridging loans can be more costly than standard home loans. Bridging finance rates are often higher, and interest is usually compounded monthly, which can increase costs if your existing property takes longer to sell. Additionally, fees such as valuation costs and broker fees add to the overall expense, so it’s essential to budget carefully and plan for potential delays.
If your property doesn’t sell within the loan’s term, you may need to request an extension from your lender, though approval isn’t always guaranteed. Some lenders may require you to begin making principal and interest payments on the peak debt to manage the outstanding balance. If an extension isn’t possible, selling your property at a reduced price may become necessary, so it’s essential to have a backup plan.
Yes, many bridging loans offer the option to make interest-only payments during the bridging period to help manage your cash flow. Some lenders also allow you to make unlimited principal and interest repayments during this time, which can help reduce your peak debt. However, it’s best to confirm these options with your lender to ensure they align with your financial plan.
A bridging finance broker specialises in short-term financing solutions designed to “bridge” the gap when you’re purchasing a new property before selling your existing one. They help you find a suitable lender for bridging finance, navigate the application process, and negotiate the best terms based on your financial situation. By working with a bridging finance broker, you can often secure a loan more quickly and with terms better suited to your needs.
Bridging brokers typically charge a fee that varies depending on the complexity of your application and the broker’s experience. Generally, this cost can range between 0.5% to 2% of the total loan amount, though some brokers might charge a flat fee. It’s a good idea to ask for a clear outline of fees before engaging a broker, as this will help you understand the overall costs involved in securing your bridging loan.
In Australia, several major banks offer bridging loans, including ANZ, Commonwealth Bank, NAB, and Westpac. These banks provide options for both closed and open bridging loans, and their terms can vary, so comparing bridge loan interest rates, loan-to-value ratios, and repayment structures is essential. Some smaller lenders and credit unions also offer bridging finance, giving you more options to find a lender that suits your needs.
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