Bridge Financing in Red Deer, AB
Bridge financing in Red Deer gives you the down payment for your next house from the equity in your current one, so you can buy before your sale closes. Your move might stay inside the city, from Normandeau or Sunnybrook to a bigger place in Timberlands, or follow a new job in Calgary or Edmonton, where the start date sets the timing. We arrange the bridge, the new mortgage and the closing plan through BRX Mortgage Inc., and in most cases the lender pays us, so you won't get a bill for our help.
To bridge, do I have to sell off my investments?
In most cases you won't, because the bridge is a short loan secured by the equity in the home you're selling. Your retirement savings and other investments can stay where they are, and you avoid cashing anything out at a bad moment. Some lenders will ask to see those accounts, so have recent statements ready.
How does the bridge loan work from start to finish?
Once your Red Deer home has a firm, unconditional sale, which most lenders require, the lender advances your equity before that sale closes. The money pays your down payment and closing costs on the new home, and your lawyer pays the bridge back from the sale proceeds. Most lenders cap a bridge at a few months, often 90 to 120 days, and the rate is higher than your mortgage, with a setup fee at some lenders. Alberta has no land transfer tax, so the main government cost is about $550 in Land Titles fees on a $500,000 home.
Would a port and blend make sense for us?
It can, if your current rate is one you want to keep and the next home needs more money. Porting moves your mortgage to the new property with the same rate and term, and the blend adds the extra at a current rate, which most lenders average into one rate. You'll need to qualify for the full amount at the greater of your contract rate plus 2% or 5.25%, so we test that before you write an offer. If your term is close to ending, compare porting with your mortgage renewal in Red Deer options before you decide.
Talk to us about your Red Deer move
Share your sale plans and the home you'd like next, and we'll show you how the bridge and the penalty fit with the new mortgage. Book a free call today.
Flow Mortgage Co. arranges mortgages through BRX Mortgage Inc. (operating as BRX Mortgage), licensed by the Real Estate Council of Alberta to deal in mortgages.
Frequently asked questions
Should we try our list price first and adjust later?
That's a fair approach, and we can run the bridge at your asking price and at a lower one so you know your floor. Pair it with a mortgage pre-approval in Red Deer so the purchase side moves as soon as you accept an offer.
Will I pay a penalty when I sell?
You can if your term isn't finished when you pay the mortgage off, and fixed rate penalties can run higher at some lenders. Ask for a written payout figure before you list in Clearview or Anders.