Buying Before You Sell: How Bridge Financing Works in BC

It's one of the most common calls we get: "We found the perfect place, but our house hasn't sold yet. Can we still buy it?" In a market like Metro Vancouver, where the right property doesn't wait around, this timing gap is completely normal — and there are well-established ways to handle it.

The core problem: your down payment is locked in your walls

Most move-up buyers plan to use the equity in their current home as the down payment on the next one. The trouble is that equity only becomes cash on your completion date — the day your sale legally closes. If your purchase completes before your sale does, you need to fund the down payment some other way for the in-between period.

Solution 1: Bridge financing

A bridge loan is a short-term loan that "bridges" the gap between your purchase completion and your sale completion. The lender advances you the equity from your current home before you've actually received it, and the loan is repaid automatically when your sale closes.

How it typically works

• You need a firm sale. Most lenders will only bridge when you have an accepted, subject-free offer on your current home. The firm contract is their security that the money is coming.
• Short terms. Bridges usually run from a few days to 90 days — just long enough to cover the gap between your two completion dates.
• Interest-only, higher rate. Expect a rate in the range of prime plus 2–5%, plus an administration fee (often a few hundred dollars). Because the term is so short, the total cost is usually far smaller than people fear — often comparable to a month of rent.
• Both mortgages at once. For the overlap period you technically carry your old mortgage, your new mortgage, and the bridge. Lenders account for this in their approval, and we structure the file so it works.

Solution 2: What if your home hasn't sold yet at all?

Bridging without a firm sale is harder — most banks won't do it. But you still have options:

• HELOC on your current home. If you set up a home equity line of credit before you list, you can draw on it for the new down payment. Timing matters: most lenders won't approve a new HELOC on a property that's already listed for sale.
• Alternative and private lenders. Some lenders will bridge against an unsold property at a higher rate. This is a short-term tool, not a long-term plan — but it can save a purchase.
• Subject-to-sale offers. You can make your purchase offer conditional on selling your home. It's the lowest-risk route financially, but in a competitive market sellers may favour cleaner offers.

Don't forget about porting

If your current mortgage has a good rate, you may be able to port it — move it to the new property, keeping your rate and avoiding the payout penalty. If the new home costs more, lenders typically "blend and extend," combining your existing rate with today's rate on the additional amount. Whether porting beats breaking-and-switching depends on your penalty, your rate and the market — that's a calculation we run for clients all the time.

How to set yourself up for a smooth buy-before-sell

1. Get pre-approved for the full picture first. Before you shop, we confirm you qualify for the new purchase including the bridge period.
2. Line up your completion dates deliberately. A gap of 1–4 weeks between purchase and sale completions is often ideal — enough time to move once, without a costly overlap.
3. Talk to your broker before you list. Decisions like setting up a HELOC or choosing a lender that bridges easily need to happen early.

Buying before selling feels stressful because two large transactions are moving at once. But with the financing mapped out ahead of time, it's a well-worn path — one we walk clients down every month.

This article is general information, not financial advice. Rates, lender policies and program details change — talk to us for guidance on your specific situation.