Milestones
Buying Your Next Home Before You Sell This One
Bridge financing and equity strategies so you are not forced to move twice.
The classic bind: you have found the next home, but your down payment is locked inside the home you have not sold yet. You do not necessarily have to sell first, move into a rental, and move again. There are bridges.
The tools
- A bridge loan provides short-term funds against your current home’s equity so you can make a strong, non-contingent offer on the next one, then repay it when your home sells.
- A HELOC opened in advance on your current home can supply the down payment for the next, without touching your current low first-mortgage rate.
- Qualifying with both payments temporarily, if your income supports it, so you are not racing the calendar.
The trade-offs
Carrying two homes briefly costs more and adds risk if your current home takes time to sell. The payoff is enormous: you buy on your terms, move once, and avoid making a contingent offer that a seller may reject in favor of a cleaner one.
Pro tip
Open the HELOC on your current home before you list it — lenders are far more willing to extend a line on a home that is not yet on the market. Set up the bridge before you need it.
Common questions
Can I use the equity in my current home for the new down payment?
Yes — through a bridge loan or a HELOC opened before you list. Both let you access that equity without selling first, so you can make a strong offer on the next home.
Is it risky to own two homes at once?
There is cost and some risk if your current home is slow to sell, so it works best when your finances have a cushion and your home is likely to sell reasonably quickly. The reward is moving once, on your terms.