When selling one property and purchasing another, the funds from the sale may not be available in time to use for the purchase deposit. There are typically two options in this scenario: a bridging loan or a deposit bond.
A bridging loan is a short-term home loan designed to allow you to initiate the purchase of a property before you have sold your previous one.
Loan terms are often between six and 12 months and bridging loans generally have a higher interest rate than traditional home loans.
This can be a great option but carries some risk. It’s important to know that you will be able to make the repayments even in a worst-case scenario where your old house doesn’t sell as quickly as you’d hoped or where property values may change unexpectedly.