Bridge Financing in Kelowna, BC
Bridge financing in Kelowna covers the down payment on your next home with equity from the one you're selling, while both deals are still waiting to close. Moving from a Rutland townhouse to a detached home in Kettle Valley is one example, and if the purchase closes a few weeks before the sale, the bridge covers those weeks. We plan the bridge and both closing dates as one file, so your lawyer has the money on possession day. In most cases the lender pays us, which means our help costs you nothing.
How does a bridge loan work when I buy before I sell?
Your lender advances a short loan against the equity in your current home, and that money pays the down payment and closing costs on the new one. Most lenders cap a bridge at a few months, often 90 to 120 days, and your sale proceeds pay it off the day your Kelowna home closes. The bridge usually costs more than your mortgage and some lenders add a setup fee, so ask for both figures in writing before you sign.
Most lenders also want a firm, unconditional sale on your current home first. If your Glenmore house is still listed, get your mortgage pre-approval in Kelowna done now so you know what you can buy with the sale and without it.
Will I pay a penalty when I sell my home?
You can, if you pay off a mortgage that still has time left on its term. On a fixed rate, some lenders base the penalty on the gap between your rate and current rates. That figure moves with the market, so get a written payout statement before you accept an offer. If your term ends within a few months of the move, a short or open term at your mortgage renewal in Kelowna can keep that penalty small.
Should I port my mortgage or blend it with new money?
Porting moves your current mortgage, with its rate and term, onto the new home, and many lenders allow it when both closings fall inside a window they set. When the new place costs more, a port and blend keeps your old rate on the existing balance and adds the extra at a current rate, and most lenders average both into one rate. You'll qualify for the bigger amount under the stress test, which uses the greater of your contract rate plus 2% or 5.25%. If you're relocating to Kelowna from Vancouver or Alberta, ask early whether your lender will port across a provincial line.
Plan your Kelowna move on a free call
Send us your listing price, the purchase price and both closing dates, and we'll lay out the bridge and the penalty on one call. Book a free call to get started.
Flow Mortgage Co. arranges mortgages through BRX Mortgage Inc., licensed with the BC Financial Services Authority.
Frequently asked questions
Do I have to cash out my investments to bridge?
In most cases you won't, because the bridge borrows against your home's equity and your investments can stay where they are. You can also add savings to shrink the bridge, and we'll price both versions.
What does BC's property transfer tax add to my move?
Since you've owned a home before, the first-time buyer exemption won't apply, so budget about $8,000 in tax on a $500,000 purchase. It's due on closing day, so we build it into the bridge amount.