Bridge Loan Rates in Florida: Buying Before You Sell
Bridge loan rates Florida borrowers see run above conventional. Here is what they cost, how the structures differ, and when the speed is worth it.
Educational content only. This article is for informational purposes and does not constitute financial, legal, or lending advice. Loan programs, rates, and eligibility requirements change frequently. Consult a licensed mortgage professional before making any borrowing decision. Mortgage Capital | NMLS# 1859012 | Licensed in Florida.
A bridge loan covers the gap between buying your next home and selling your current one. You borrow against the equity you already have.
It solves a timing problem, and it charges you for solving it. Our bridge loan page covers the structures.
What they cost
Rates commonly run in the high single digits to low teens, above a conventional mortgage.
Add one to three points at origination, plus lender fees and legal costs.
Terms run six to twelve months, sometimes extendable at a further cost.
Because the hold is short, points matter more than rate. Two points on a nine-month loan is a large annualised number.
Why the rate is higher
The lender is taking short-term risk on a sale that has not happened yet.
Your ability to repay depends on a transaction outside anyone's control.
If the current home does not sell, the lender is holding a loan with no exit.
That uncertainty is what you are paying for, not your credit quality.
The two common structures
The first borrows against your current home, giving you cash for the down payment on the next one. You then carry two mortgages briefly.
The second finances the new purchase directly, repaid when the old home sells.
The first is more common and usually cheaper. The second suits buyers whose current home has little equity.
Ask which a lender offers before comparing rates, because the numbers are not directly comparable.
How much you can borrow
Most lenders cap combined borrowing at 75% to 80% of the current home's value.
Your existing mortgage counts against that ceiling.
Work out the room on the CLTV calculator before you plan an offer around it.
Some programs also look at the new property, which tightens things further.
Where Florida changes the maths
Carrying two properties means carrying two insurance premiums, and Florida premiums are high.
Two tax bills as well, and the new one is assessed at your purchase price with no homestead cap.
Hurricane season adds real risk. A named storm can delay a sale by weeks.
Budget for a longer bridge than you expect, and confirm the extension terms before you sign.
When it is worth paying for
When you would otherwise lose the house you want. In competitive South Florida submarkets a non-contingent offer wins.
When moving twice would cost more than the bridge, which is common with families and larger homes.
When your current home will clearly sell, and the delay is logistical rather than market-driven.
It is not worth it when the sale is uncertain. That is when bridges become expensive traps.
The alternatives worth pricing first
A HELOC on your current home, opened before you list it. Far cheaper, but most lenders will not open one on a home about to go on the market.
A home equity loan, same logic and the same timing constraint.
A contingent offer, which costs nothing and loses more contracts.
Renting back from your buyer after closing, which solves the same problem for free where they will agree.
What lenders look at
The equity in your current home, first and most.
Whether you can carry both payments if the sale is slow, though some programs qualify you on the bridged position only.
The marketability of the departing property. A listed home with showings is a better story than an unlisted one.
Credit matters, though less than on a conventional mortgage.
Planning the exit before you borrow
Price your current home realistically rather than optimistically. The bridge assumes the sale price you tell the lender.
Know what an extension costs and how many are available.
Have a fallback: renting the departing property, or refinancing the bridge into a longer-term loan.
Model the total cost including points and holding costs, not just the rate.
What to ask before you sign
What happens in month seven on a six-month note, and what does an extension cost?
Is there a minimum interest period, guaranteeing the lender a set return even if you repay early?
Are payments interest-only, or is there an interest reserve funded from the loan?
None of these show in the headline rate, and all three change the real cost.
Hurricane season timing
A named storm can pause showings, delay inspections and stall closings across South Florida for weeks.
If your bridge matures in September or October, build margin in.
Insurers also suspend binding new policies when a storm is in the cone, which stops closings outright.
That is a Florida-specific risk worth a longer term rather than a cheaper one.
The short version
Bridges buy certainty. Price the alternatives first, and only pay for one when the sale is genuinely likely.
Documents to have ready
Mortgage statements and payoff quotes for the current home.
The purchase contract on the new property.
Two months of bank statements showing reserves to carry both positions.
Where to start
Bring us both properties: the current home with its mortgage balance, and the target purchase.
We will price the bridge against a HELOC and against a contingent offer so you see all three.
The CFPB guide to owning a home covers the purchase process itself.
Start with a pre-approval so the bridge is planned rather than improvised.