Bridge financing vs HELOC —
how to buy before
you sell.
When your new home closes before your old one, bridge financing advances your down payment for the gap. A HELOC can work too — but only if it’s already in place. Here’s which fits your timing.
Four factors that decide
which one fits.
Both products solve the same problem. The deciding factor is almost always timing and what you already have in place.
Speed to arrange
Bridge financing is set up fast — right alongside your new mortgage with the same lender. A HELOC takes full underwriting and registration: instant if already open, far too slow to set up once you're mid-deal.
A firm sale is the key factor
Bridge financing generally needs your current home sold with conditions waived — the lender bridges against a sure thing. A HELOC has no firm-sale requirement, but many lenders freeze or discharge it once your home is listed.
Very short vs. open-ended
Bridge financing is purpose-built for the gap: days to a few months, repaid automatically when your sale closes. A HELOC is a revolving line — open-ended and reusable well beyond just the closing gap.
Similar rate, different structure
Both charge variable interest on the drawn amount (roughly prime + a margin). Bridge also carries a small admin fee. Total cost on either is modest because the term is short — the real difference is availability, not price.
Three steps to
the right decision.
The right answer depends on your timeline and what’s already in place — not which product sounds better on paper.
Understand your closing gap
Find out exactly how many days or weeks separate your purchase closing from your sale closing. That window determines how much you need, for how long, and which product is actually available to you right now.
Check what's already in place
Do you have a HELOC on your current home with enough available room — and will your lender allow draws while you're listed or under contract? If yes, that may be your answer. If no, bridge financing is almost always the cleaner path.
Line it up before you write offers
The worst time to arrange gap financing is after your offer is accepted. Talk to us before you write — we'll coordinate bridge financing with your new mortgage, or set up a HELOC on your current home while it's still easy to qualify.
Which is right
for you?
Tap any situation below to see how we approach it.
If you’re…New home closes 2 weeks before your sale
New home closes 2 weeks before your sale
The classic case. Get your sale firm first, then bridge the down payment for the short gap — repaid automatically when your sale closes. We arrange it alongside your new mortgage so there's one application, one advisor.
Get bridge financingIf you’re…You already have a HELOC with available room
You already have a HELOC with available room
Draw the down payment from your existing line and repay when your sale closes. Often cheaper than a bridge — if your lender allows draws while the home is listed or sold. Confirm with us before you draw; some lenders freeze the line once it's listed.
Understand my HELOCIf you’re…Home listed but not yet sold
Home listed but not yet sold
Most lenders bridge only against a firm sale. Get conditions waived first, or open a HELOC on your current home before you list if you want flexibility either way. We'll map both paths for your timeline.
Talk to a brokerIf you’re…A move is on the horizon, not imminent
A move is on the horizon, not imminent
Opening a HELOC before you list gives you a ready-made gap solution and general flexibility — set it up early while it's still easy to qualify, well before the home goes on market.
Learn about HELOCsIf you’re…You want the fastest, simplest gap solution
You want the fastest, simplest gap solution
Bridge financing is the default tool for this exact situation. It's designed for the closing gap, arranged quickly through your mortgage lender, and repaid automatically — nothing to manage on your end.
Apply for bridge financingIf you’re…You need equity access beyond just the gap
You need equity access beyond just the gap
If you need more than just the down-payment float — renovation funds, ongoing access after you move — a HELOC's revolving structure gives you flexibility a short bridge can't. Set it up on your current home before you list.
Explore HELOC optionsBridge financing vs HELOC —
every factor compared.
The right product is almost never about cost — it’s about what’s available when you need it.
- Your purchase closes before your sale
- You have a firm, sold sale on your current home
- You need money for days to a few months only
- You want a clean, fast solution through your lender
- You already have a HELOC with room on your current home
- You set it up well before listing or buying
- You want flexible, reusable access beyond just the gap
- Your lender won’t freeze it once the home is listed
| Factor | Bridge Financing | HELOC |
|---|---|---|
| Purpose | Built specifically for the closing gap | General home-equity borrowing |
| Speed to arrange | Fast — set up alongside your purchase | Slow to set up new; instant if already open |
| Needs a firm sale? | Yes — usually requires a sold, firm deal | No, but lender may freeze it once listed |
| Term | Very short (days to a few months) | Open-ended revolving |
| Cost | Interest (often prime + a margin) + small fee | Variable rate (prime + a bit) on drawn amount |
| Repaid | Automatically when your sale closes | Whenever you choose (repay from sale) |
| Set up timing | Can be arranged mid-deal | Must exist BEFORE you're mid-deal |
| Best for the gap | The default tool | Only if already in place |
Either way — plan it before you write offers.
Common questions,
clear answers.
Bridge vs HELOC, firm sale rules, costs, and when to arrange it — answered plainly.
What's the difference between bridge financing and a HELOC?
Bridge financing is a short-term loan built specifically to cover your new down payment during the gap between your purchase closing and your sale closing — it's arranged fast against your firm sale and repaid automatically when you sell. A HELOC is a revolving line of credit on your current home you can also draw for the down payment, but only if it's already set up with room available. Bridge is the purpose-built default; a HELOC works mainly if it pre-exists.
Do I need a firm sale to get bridge financing?
Usually, yes. Most lenders bridge against a sold, firm deal (conditions waived) because that's the guaranteed source of repayment. If your home is listed but not yet sold, bridging is harder — some lenders decline it, others charge more or require a larger equity cushion. The clean path is to get your sale firm first, then bridge the gap to your purchase.
Can I use a HELOC to buy before I sell?
Yes, if you already have a HELOC on your current home with enough available room and your lender permits drawing on it while the home is listed or sold. The problem is timing: you usually can't open a new HELOC fast enough once you're mid-deal, and many lenders freeze a HELOC on a home that's being sold. So it works best when set up well before you list.
How much does bridge financing cost?
Typically interest for the short bridge period (often prime plus a margin) plus a small administration fee — usually a few hundred dollars. Because the term is so short (days to a few months) and it's secured by your firm sale, the total cost is modest relative to the convenience of buying your next home without waiting for your sale to close.
When should I arrange gap financing?
Before you write offers. The most common mistake is sorting out closing-date financing at the last minute, when a new HELOC is too slow and a bridge needs your sale to be firm. Talk to a broker early so we can map your timing and line up bridge financing with your new mortgage — or set up a HELOC on your current home ahead of listing to keep options open.
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 mortgage specialist in your city
Bridge financing and HELOC setup work the same way across Canada, but getting the timing right — and coordinating your gap financing with your new mortgage — is easiest when you're working with a local advisor who knows the lenders and closing timelines active in your market.