About the Bridge Loan Calculator
This bridge loan calculator estimates how much you can borrow against the equity in your current home to buy your next one before the first has sold, and what that short-term loan will cost. It applies the lender’s maximum combined loan-to-value (CLTV) to your home value, subtracts your existing mortgage, and then works out interest, origination fees and the total cost for the months you expect the loan to run.
It is built for homeowners moving up or relocating who need their equity for the next down payment, and for anyone comparing a bridge loan with a HELOC, a home-sale contingency or renting in between. The monthly carrying cost shows what you would pay while owning two homes, which is the part that most often strains a budget.
Bridge loans usually last 6 to 12 months and are repaid from the sale proceeds. Choose whether you pay interest monthly or let it accrue and pay it at closing; deferred interest compounds monthly in this model. Rates and fees vary widely by lender.
With the default inputs, the total cost of the bridge loan is $9,300.00. Change any value above to recalculate instantly.
How to use the bridge loan calculator
- 1Enter your current home’s value and the mortgage balance still owed.
- 2Enter the lender’s maximum CLTV and how much cash you need for the new home.
- 3Enter the bridge rate, fees and how many months you expect it to take to sell.
- 4Choose whether you will pay interest monthly or defer it until the sale.
- 5Add your current and new mortgage payments to see the two-home carrying cost.
Formula and method
Lenders cap the total debt secured on your current home, so the most you can borrow is the home value times the maximum combined loan-to-value, minus what you still owe. The loan you take is the smaller of that limit and the cash you need.
With monthly payments the bridge loan is interest-only: each month you pay the loan amount L times the monthly rate r, for m months. With deferred interest nothing is paid until the sale, and unpaid interest compounds monthly. Origination is a percentage of the loan, and other closing costs are added as a flat amount. The loan balance (plus any deferred interest) is repaid from your sale proceeds.
- L
- Bridge loan amount
- CLTV
- Maximum combined loan-to-value allowed by the lender
- r
- Monthly interest rate (annual rate ÷ 12 ÷ 100)
- m
- Months until your current home sells
Worked examples
$120k bridge at 9% for 6 months, interest paid monthly
At 80% CLTV on a $500,000 home with $250,000 owed you can borrow up to $150,000, so the full $120,000 is available. Interest is $120,000 × 9% ÷ 12 = $900 a month, or $5,400 over six months. Add a 2% origination fee ($2,400) and $1,500 other costs for a total of $9,300.
Deferred interest for 9 months
Deferring interest at 10% for nine months lets $120,000 grow to about $129,306 by the sale, so $9,306 of compounded interest is paid from the proceeds. Including $3,900 in fees, the bridge costs about $13,206.
Not enough equity for the full amount
At 75% CLTV, $400,000 supports $300,000 of total debt; with $260,000 owed only $40,000 can be bridged, $60,000 short of what is needed. Interest on $40,000 at 9% for six months is $1,800, plus $800 origination and $1,500 other fees, for a total cost of $4,100.
Frequently asked questions
How does a bridge loan work?+
A bridge loan is a short-term loan secured by your current home that gives you cash, usually for the down payment on your next home, before your current home sells. It is repaid in full, with any deferred interest, from the sale proceeds.
What are typical bridge loan rates and fees?+
Bridge loans generally cost more than a standard mortgage — rates are often a few points above 30-year mortgage rates, and origination fees of about 1% to 3% plus appraisal and closing costs are common. Always compare quotes from several lenders.
How much can I borrow with a bridge loan?+
Most lenders let your existing mortgage plus the bridge loan reach 75% to 80% of your current home’s value. Some lenders base it on the combined value of both homes instead.
What happens if my house does not sell before the bridge loan ends?+
You may be able to extend the loan for a fee, refinance it, or you may have to reduce the price to sell faster. Missing repayment risks foreclosure on the home securing the loan, so build in a realistic sale timeline.
What are the alternatives to a bridge loan?+
Common alternatives include a HELOC or home equity loan taken out before listing, a home-sale contingency on your offer, a 401(k) loan, or selling first and renting short-term. Each trades cost, flexibility and risk differently.
Results are estimates for educational purposes and are not financial advice. Rates, fees and terms vary — confirm with your lender or a licensed advisor before making decisions.