Offices in Ottawa and Perth
(613) 722-1500

CONTACT US (613) 722-1500

Bridge Financing

Bridge Financing


Posted March 16, 2021

In today’s real estate market house sales are continuing to move at a rapid pace. Both Buyers and Sellers are feeling the pressure in the ever-demanding market. If you’re thinking about either buying or selling, here are some things you may wish to do that might help lift some of that pressure.  Assembling your team before you start looking or list your home (i.e. realtor, lawyer, and mortgage broker or lender, home inspector, if buying, etc.) may allow you to act quicker and give you advantage while protecting your interests. Obtaining a pre-approval for a mortgage is another highly recommended step before beginning your home search. Another tool that you may wish to consider, especially if you are going to be selling your current home to purchase another, is bridge financing.

What exactly is bridge financing?

Bridge financing is a temporary loan designed to help homeowners “bridge” the gap between the date their new property is purchased and their existing home is sold. It enables homeowners to use the equity in their current home towards the purchase of their next home.

Bridge loans are short-term solutions. Generally, to be eligible for a bridge loan you need to have a firm purchase and sale agreement in place on your existing home. This requirement should be confirmed with the mortgage broker/lender who may provide the bridge financing. It is also recommended to receive a large deposit from the buyer on the sale of your existing home.

Potential advantages of bridge loans

  • Can help buy a house before the current home sells
  • Allows you to space out transactions to avoid buying and selling on the same day
  • Allows a homeowner to use the equity in their current home towards the purchase of their new home
  • Can give a homeowner the resources and time to make upgrades to the new home before moving in

Potential disadvantages of bridge loans

  • Interest can be more expensive than conventional financing
  • Can vary widely in terms, costs and conditions (or example, some lenders require a mortgage to be registered)
  • Can be a higher risk for a homeowner if their sale does not close

It is recommended that before scouting for your next home, it may be beneficial to discuss with your mortgage broker or lender the various options and requirements for bridge financing. It is important to be aware of any conditions that may need to be fulfilled for the loan, total costs related to the loan, and what other requirements may be needed.  Bridge financing may not be suitable for everyone but exploring the option may help lift some of the pressure brought on by the current real estate market.

This blog post was written by Diana Tebby, a member of the Real Estate and Wills and Estates teams.  She can be reached at 613-369-0384 or at

More Resources

Blog |
Employment, Labour, and Human Rights, Commercial Litigation


Posted May 23, 2023

Both in my commercial and employment litigation practice, I encounter Ontario business owners faced with serious charges laid against them under the Provincial Offences Act[...]
Blog |
Family Law


Posted May 18, 2023

The recent Supreme Court of Canada decision in Anderson v. Anderson, 2023 SCC 13, provides guidance on domestic contracts and the enforceability of an informal[...]
Blog |
Environmental Law


Posted May 16, 2023

When many people think of contaminated sites, they think of the usual suspects such as industrial properties and gas stations.  They may not think of[...]
Blog |
Business Law


Posted May 9, 2023

Often business owners reach a point where they are considering the sale of their business either through the sale of shares or the sale of[...]
Blog |
Family Law


Posted May 2, 2023

Overview of Tort Claims in Family Matters Tort claims can be made in family law matters, so as to prevent a multiplicity of proceedings and[...]
Blog |
Employment, Labour, and Human Rights


Posted April 25, 2023

In a case that recently was decided from the Court of Appeal of Ontario called Celestini v Shoplogix Inc., 2023 ONCA 131, the Court had[...]

Subscribe to Our Newsletter

"*" indicates required fields

This field is for validation purposes and should be left unchanged.