What does a bridge loan cost?

Bridge loans typically carry rates of prime + 1-2% (currently 9-11% in 2024), 1-2 origination points, and short terms of 6-12 months. Total cost on $200,000 for 6 months: approximately $10,000-$12,000.

Are bridge loans worth the cost?

Sometimes. The alternative — making a contingent offer — weakens your purchasing position in competitive markets. Calculate whether the bridge cost is less than the price discount from a contingent offer.

What are the alternatives to a bridge loan?

HELOC on the current home, contingent sale offer, 401(k) loan for down payment, or renting your current home after purchase. Each has different cost and risk profiles.

Bridge Loan Cost Calculator

Calculate the total cost of a short-term bridge loan used to purchase a new home before selling the existing one. Includes interest, origination, and carrying costs.

Principal ($)

Annual Rate (%)

Years

Compounding / Year

$ Finance Disclaimer: These calculators are for educational and illustrative purposes only. Results do not constitute financial advice. Consult a licensed financial advisor before making investment or borrowing decisions.

How to Use

Enter the values for the scenario you are assessing. Calculate the total cost of a short-term bridge loan used to purchase a new home before selling the existing one. Includes interest, origination, and carrying costs. Use the bridge loan cost result to inform your calculation.

Related Calculators

Home Affordability

Finance & Accounting

HELOC vs Personal Loan

Finance & Accounting

Interest-Only Period

Finance & Accounting

Bridge Loan Cost Calculator

How to Use

Related Calculators

Frequently Asked Questions

What does a bridge loan cost?

Are bridge loans worth the cost?

What are the alternatives to a bridge loan?