Bridge financing:
close your purchase
before your sale closes.
Bridge financing covers the gap between buying your next home and closing on your current one. It funds on your purchase closing day, runs interest-only, and carries no penalty when your sale completes.
Bridge financing in Canada is a short-term loan that lets you close on your new home before your existing property sells — using the equity in your current home as collateral. Rates run Prime + 2–3% and terms are typically 30–90 days. Your existing lender usually arranges bridge financing automatically when both transactions are confirmed; a broker shops alternatives when the existing lender's terms aren't competitive.
Four reasons bridge
financing works for move-up buyers.
A bridge is simple in concept. The lender match and the closing-day coordination are where most files succeed or fail — we handle both.
Funds on your purchase closing day
The bridge advances alongside your new mortgage on purchase day — same lawyer, same closing. Your purchase doesn't have to wait for the sale to complete.
Interest-only, no principal payment
You pay interest only for the exact days the bridge is outstanding — no principal, no prepayment penalty when the sale closes and pays the bridge in full.
No prepayment penalty at payout
Bridge financing is purpose-built to be repaid from sale proceeds. When your sale closes, the bridge pays out automatically with no penalty — you owe only the days-outstanding interest.
Often one lender, one approval
Most A-lenders who fund your new purchase mortgage will bridge against your sale in the same application — one approval, one legal close, no extra underwriting wait.
How bridge financing
works — three steps.
Both deals firm first. Purchase closes, bridge funds. Sale closes, bridge repays. That's it.
Confirm both deals are firm
Bridge requires a firm sale agreement (financing condition cleared) on your existing home and a firm purchase agreement on the new one. Conditional sales generally need to firm up first, though some lenders will bridge a conditional sale at higher rates. If your sale isn't firm, the lender may qualify you on carrying both properties.
We arrange the bridge alongside your purchase mortgage
Most often the same A-lender funding your new purchase will bridge against your sale — one application, one approval, one funding day. We size the bridge to your down-payment gap plus closing costs.
Both deals close, bridge pays out automatically
On purchase day the bridge funds alongside your new mortgage. On sale day (often days later) the sale proceeds repay the bridge in full. You owe interest only on the days the bridge was outstanding. No prepayment penalty.
We can bridge
whatever your gap.
Tap any situation below to see how we approach it.
If you’re…Your purchase closes before your sale
Your purchase closes before your sale
This is the classic bridge scenario — the bridge funds your down payment on purchase day using your departing home's equity. When the sale closes days later, the bridge pays out automatically from the proceeds. Most of our bridge files are arranged this way.
Arrange my bridgeIf you’re…You need sale proceeds to fund the down payment
You need sale proceeds to fund the down payment
The bridge advances exactly the down-payment shortfall — the gap between what you owe on your old home and the equity you need for the new one. We size it precisely so you don't borrow more than required and interest cost stays minimal.
Size my bridgeIf you’re…Your sale is still conditional
Your sale is still conditional
A firm sale is the standard requirement. Some lenders will bridge a conditional sale at higher rates; others won't. We tell you exactly which of our 100+ lenders will fund your specific situation — firm or conditional — before you commit to anything.
Check my optionsIf you’re…You're self-employed or new to Canada
You're self-employed or new to Canada
Bridge underwriting focuses on the sale agreement and equity, not income — income was already underwritten for the purchase mortgage. In our experience, self-employed and newcomer files bridge readily once the purchase mortgage is approved.
Start my applicationIf you’re…Your gap is longer than a few days
Your gap is longer than a few days
Bridge terms are typically up to 90–120 days with most lenders (some allow longer). You pay interest only for the days used — a longer gap means more interest, but no penalty and no new underwriting. We model the exact cost before you commit.
Estimate my bridge costIf you’re…You're worried about what happens if your sale falls through
You're worried about what happens if your sale falls through
If a firm sale collapses (rare), the bridge must still be repaid — typically through re-sale, refinancing, or a private or second mortgage against your equity. We confirm those contingency terms and build a plan before the bridge is funded.
Discuss my contingencyWhat a bridge actually
costs — all-in.
Bridge financing is a short-term loan. The all-in cost for most files is a few hundred to a couple thousand dollars.
- Purchase closesTuesday
- Sale closes9 days later
- Down payment needed$250,000
- Option A: forced extensionSeller may refuse
- Option B: carry two mortgages~$6,000/month
- Worst caseDeal collapses
- Purchase closes on timeTuesday
- Bridge interest (9 days, ~6.45%)~$396
- Lender admin fee~$400
- Legal cost (bridge registration)~$250
- Bridge repaid from sale proceedsAuto on day 9
- Total bridge cost~$1,046
Illustrative only — your bridge amount, days outstanding, rate, and all-in cost will differ. We compute your exact numbers before you commit. Try the bridge loan calculator.
Common questions,
clear answers.
Bridge cost, firm sale rules, stress test, and what happens if the sale falls through — answered plainly.
What is bridge financing?
A short-term loan that covers the gap between buying your new home and closing on the sale of your current one. The bridge is secured against the equity in your departing home, funded the same day your purchase closes, and repaid automatically when your sale completes. Terms are typically up to 90–120 days with most lenders (some allow longer); you pay interest only for the days used.
How much can I borrow with a bridge loan?
Up to the equity in your departing home, minus your existing mortgage balance and any closing costs. So on a $1.2M sale with a $500K mortgage, you have roughly $700K of bridge-able equity (minus selling costs and a safety buffer). Most files bridge $50K–$300K to cover the down payment shortfall.
What does bridge financing cost?
Interest only, typically prime + 1% to prime + 4% depending on the lender. On a $150K bridge for 30 days at prime + 2% (about 6.45% with the big-bank prime rate at 4.45% in September 2026; illustrative), expect roughly $795 in interest. There's usually a small administration fee ($300–$500) and an additional legal cost for the bridge registration.
Do I need a firm sale to qualify for bridge?
Almost always — the bridge is secured by sale proceeds, so the lender needs the sale to be firm (financing condition cleared). Some lenders will bridge against a conditional sale at materially higher rates; some won't bridge without an unconditional sale. We'll tell you which lenders accept your specific situation.
What if my sale falls through?
If a firm sale collapses (rare), the bridge still has to be repaid, usually by re-selling, refinancing, or a second or private mortgage against your equity. Each lender handles a collapsed sale differently, so we confirm those terms and build a contingency plan before funding.
Bridge financing vs HELOC for the down payment?
HELOC is cheaper rate-wise but requires existing setup and qualifies against debt-service ratios. Bridge is purpose-built for the sale-purchase gap, funds same-day with your purchase, and exits automatically. For one-time gap funding, bridge usually wins on simplicity and speed; for ongoing equity access, HELOC wins on rate.
How long does it take to arrange bridge financing?
Most files arrange in 1–3 business days once both purchase and sale agreements are firm. Same-day funding happens on purchase closing day. If you're working with the same lender funding your new mortgage, the bridge is often a same-application add-on with no separate underwriting wait.
Do I pay penalty when the bridge closes?
No — bridge financing is designed to be repaid from sale proceeds and carries no prepayment penalty. You pay interest only for the days the bridge was actually outstanding.
Can I bridge if I'm self-employed or new to Canada?
Yes — bridge underwriting focuses on the sale agreement and equity rather than income (income was already underwritten for the new purchase mortgage). In our experience, self-employed and newcomer files can bridge readily once the purchase mortgage is approved.
Does a bridge loan count against my stress test?
Generally no. Lenders qualify the bridge on your firm sale (lender policies vary; if your sale isn't firm, the lender may qualify you on carrying both properties), because it's a short loan repaid from sale proceeds rather than a long-term residential mortgage. Your new purchase mortgage is the one qualified under the stress test, at the greater of the contract rate plus 2% or 5.25%.
We’ll try to beat your rate.
If we can’t, we pay you $500.¹
¹ Rate Beat: eligible Big-6 bank written offers only · same product, term & amount · $500 paid to you or your nominated charity at closing · conditions apply
Find a bridge financing specialist in your city
Bridge windows are tight — usually days between your purchase close and sale close. We have advisors across Canada ready to arrange your bridge alongside your new mortgage, same lender, same closing day.