Worried you’ll find the right Boca Raton home before your current one sells? You’re not alone. In competitive neighborhoods, sellers often prefer offers without a sale contingency, which can put you at a disadvantage. A bridge loan can help you buy first, then sell on your timeline. In this guide, you’ll learn how bridge loans work, what they cost, who qualifies, and how to use one wisely in Palm Beach County. Let’s dive in.
Bridge loan basics
A bridge loan is short-term financing that covers the gap between buying your next home and selling your current one. It is usually secured by the equity in your existing property and allows you to write a non-contingent offer on the new home. Repayment typically happens when your current home sells or when you refinance into permanent financing.
Move-up buyers use bridge loans to stay competitive, unlock equity for a down payment, and keep life moving without rushed decisions. Alternatives exist, but a bridge loan focuses on speed and flexibility when timing matters most.
Why it helps in Boca Raton
Boca Raton has a mix of luxury single-family estates, waterfront properties, and gated communities where competition can vary by season and neighborhood. Communities that attract move-up buyers, including gated options such as Boca Bridges, often see buyers who need equity from a current home to purchase. When inventory is tight or sellers prioritize clean terms, a non-contingent offer can help you stand out.
Local details matter. HOA rules, condominium lending requirements, and flood zone insurance in South Florida can affect both your short-term and long-term financing. A clear plan for insurance, taxes, and HOA fees will help you carry costs comfortably during the transition.
How the financing works
Bridge lenders look at the equity in your current home and your ability to manage short-term payments. You can tap a portion of your equity for the new purchase, then pay off the bridge when your old home closes.
Typical terms and costs
- Term length is commonly 3 to 12 months, with possible extensions that may add cost.
- Payments are often interest-only during the bridge period; some products allow deferred interest until sale.
- Rates and fees are higher than traditional mortgages because the loan is short term and built for speed. Expect origination, appraisal, title, and closing costs.
- Lenders usually limit advances to keep combined loan-to-value within their policy, which means you need meaningful equity to qualify.
Underwriting and documents
Lenders verify equity, credit, income, and marketability. Plan to provide:
- Current mortgage statements and a title search
- An appraisal or broker price opinion on your existing home
- Income and credit documentation
- A purchase contract for the new home
- Your listing strategy or marketing plan for the current home
What it may cost you
Your total cost includes interest on the bridge loan plus overlapping ownership expenses. In Palm Beach County, property taxes, homeowners insurance, potential flood insurance, and HOA fees can be meaningful, so build them into your plan.
Hypothetical example
Assumptions for illustration only:
- Current home value: $800,000; mortgage balance: $400,000
- Need $200,000 for the new home down payment; bridge advance: $200,000
- Sample bridge rate: 8% interest-only
- Monthly interest: about $1,333 ($200,000 × 0.08 ÷ 12)
Possible outcomes:
- Fast sale at 30 days: interest about $1,333 plus a portion of closing fees
- Typical sale at 90 days: interest about $4,000; add new home carrying costs such as a $4,500 P&I payment plus $1,200 for taxes/insurance/HOA, for about $5,700 per month
- Slow sale at 180 days: interest about $8,000 total; longer overlaps increase exposure
Real numbers will depend on your rate, fees, taxes, insurance, and HOA dues.
Cost levers and planning
- Negotiate fees where possible and set a listing strategy that supports a quick sale
- Keep a reserve for 3 to 6 months of overlapping costs
- Consider purchase price negotiations or seller credits to offset costs
- Coordinate early with your lender, agent, and title company to streamline closings
Are you a good candidate?
Use this quick checklist to self-screen:
- You have strong equity in your current home, often 20 to 30 percent or more
- Your income and credit are solid, and you can handle short-term interest payments
- You have reserves to cover several months of overlapping costs
- Your current home is marketable and likely to sell within the bridge term
- You are comfortable with short-term higher costs in exchange for speed and flexibility
Your step-by-step timeline
- Get pre-approved for bridge financing and confirm your maximum advance
- Complete valuation and title work on your current home
- Close the bridge loan and secure the new purchase without a sale contingency
- List and market your current home, using a pricing strategy aligned with your bridge term
- Close on your sale and repay the bridge loan or refinance into permanent financing
Key risks to weigh
- Sale delays can increase carrying costs and create stress
- Short-term loans carry higher rates and fees than traditional mortgages
- Coordinating back-to-back closings requires careful timing across lenders, title, and HOAs
- If market values soften, sale proceeds may be lower than expected
Alternatives to compare
- HELOC or home equity loan on your current home, which may offer different rates and fees
- Cash-out refinance, which can change your long-term mortgage terms
- Contingent offer, which reduces risk but may be less competitive
Each option has tradeoffs. Compare total costs, speed, and your comfort with risk.
How we support your move
The Ina Bloom Team leverages Compass programs designed to make transitions smoother. Bridge Loan Services can help you buy first without a sale contingency, while Concierge supports pre-listing improvements to help your current home show at its best. Private Exclusives can create discreet exposure if you prefer an off-market sale strategy. We coordinate all parties so your financing, listing, and closings align.
Smart questions for lenders
Ask these before you apply so there are no surprises:
- What are your current rates, origination fees, and any extension fees?
- How much of my equity can I access, and what is the maximum combined LTV?
- What is the typical timeline from application to funding in Boca Raton?
- Do you require an appraisal, and what valuation method is used?
- Are payments interest-only, and can interest be deferred until sale?
- Are there prepayment penalties?
- How will this bridge loan affect my qualification for the permanent mortgage?
- Are there restrictions for condos, HOA communities, or investment properties?
- What happens if my home sells for less than expected?
- What documentation do you require from me at each step?
Plan your sale and purchase
Bridge financing works best with a clear listing and marketing plan. Align your target list price, expected days on market, showing strategy, and improvement plan with your bridge term. Confirm HOA, condo, and flood insurance requirements early so they do not delay underwriting or closings. With the right preparation, you can move forward confidently and keep your life moving on your schedule.
Ready to explore your options and map a plan tailored to your goals in Boca Raton or greater Palm Beach County? Connect with Ina Bloom for a private consultation and a coordinated strategy that brings financing, listing, and timing together.
FAQs
What is a bridge loan and how does it differ from a HELOC?
- A bridge loan is short-term financing to help you buy before you sell, while a HELOC is a revolving line of credit secured by your current home with different terms and flexibility.
How long do bridge loans typically last in Palm Beach County?
- Most run 3 to 12 months, with possible extensions that may add cost depending on the lender.
Will a bridge loan affect my ability to get the new mortgage?
- Yes, underwriters consider your total obligations; many require proof the bridge will be repaid by sale proceeds or paid off before the permanent loan closes.
What happens if my current home takes longer to sell in Boca Raton?
- You continue paying interest and carrying costs, and you may need an extension; planning reserves for several months helps manage this risk.
Are bridge loans available for condos or HOA communities in Boca Raton?
- Often yes, but some lenders and associations have restrictions, so confirm requirements early with your lender and HOA.
How do local taxes and insurance impact carrying costs?
- Palm Beach County property taxes, homeowners insurance, and flood insurance where applicable can be significant, so include them in your monthly overlap budget.
