Bridge Financing in Vancouver, BC
Bridge financing in Vancouver lets you use the equity in the home you're selling to cover the down payment on the next one, before the sale money arrives. A common Vancouver move is a Yaletown or Mount Pleasant condo to a house in Dunbar or Kerrisdale, and when the purchase closes before the sale, the bridge covers the gap. We plan the bridge, the new mortgage and the timing of both closings together, so you know your cash position for every day in between.
How does a bridge loan work when I'm buying before my sale closes?
A bridge loan is a short loan from your new lender that covers the gap between your purchase closing and your sale closing. Most lenders cap it at a few months, often 90 to 120 days, and want to see a firm sale with every condition removed before they'll approve it. Expect a higher rate on the bridge portion and a setup fee from some lenders, so we put that cost into your numbers before you remove subjects on the new home. If your sale is still conditional, get those subjects off first, because the bridge usually waits on them.
What penalties do we pay when we sell and buy?
Selling usually means paying off your current mortgage, and breaking a term early can bring a prepayment penalty. On a fixed rate, some lenders calculate a penalty that runs far higher than the same break on a variable, so ask your lender for the exact payout figure in writing before you list. On a Vancouver move-up, where the balance can be large, that one figure can decide whether it's cheaper to port your mortgage or pay it out.
Can we port and blend our mortgage to the new place?
Porting moves your current mortgage, rate and term to the new home, and most lenders allow it within a set window after your sale closes. If the house needs a bigger mortgage, a port and blend adds the extra money at a current rate and mixes both into one payment. You'll qualify again for the larger amount, and the lender can test you at the greater of your contract rate plus 2% or 5.25%. Check the porting window before you set closing dates, since a long gap can cost you the port. A mortgage pre-approval in Vancouver from us counts all of this before you write an offer.
Book a free call about your Vancouver move
Send us your sale price, your purchase price and both closing dates, and we'll map the bridge and the penalty next to the new mortgage on one page. Book a free call or phone 604-262-3500.
Flow Mortgage Co. arranges mortgages through BRX Mortgage Inc., licensed with the BC Financial Services Authority.
Frequently asked questions
Do I have to sell my investments to bridge?
In most cases you won't, because the bridge is secured by the equity in the home you've sold, so your savings can stay invested.
What else should I budget for on the Vancouver purchase?
Property transfer tax is due at closing from your own cash. BC charges 1% on the first $200,000, 2% up to $2 million and 3% above that, plus a further 2% on value over $3 million. If you plan to renovate the next place, our mortgage refinance in Vancouver page explains how to fund it later.