Some are structured so that they completely pay off the old home's first mortgage, while others pile the new debt on top of the old. The loan has a term of one-year. When you sell your current home, the bridge loan is paid off. If it is sold within the first six months, any unearned interest payments will be credited to you. The mortgage on the new home must be financed by the same lender who extended the bridge loan.
Bridge loans are costly because of high fees.
Our printable checklist guides you through the process. U.S. Highway 1, North Palm Beach, Fl. Bankrate Inc. all rights reserved.