Bridging Loan Expired and the Property Has Not Sold
Property Lending
Bridging loan expiry · Default notices · Refinancing out
Your bridge is near or past maturity and the property has not sold. Start with the triage below to work out your real deadline, then compare the cost of waiting with the cost of a lower sale price, an extension or a refinance. This guide also covers payout figures, default notices, credit reporting, AFCA and the point at which control of the sale can move away from you.
Quick Answer
When a bridging loan matures before the property has sold, it does not disappear or convert to a normal home loan. What is due, what accrues and what the lender can do next come from your contract. Ask the funder today for a dated payout figure, extension terms and the recovery deadline.
Also called: bridging finance, short term home loan, relocation loan.
What should you do first when a bridging loan has expired?
Your first move depends on where you are in the sequence, because a bridge that expires in 30 days is a different problem from one that expired yesterday, one with a signed sale contract, one with a payout shortfall, or one already in enforcement. Almost everything written about an expired bridge collapses those situations into one. Do not. Find your row first, because the cheapest options disappear in a predictable order as the file moves from performing loan, to expired loan, to recovery and then enforcement.
If the facility that has run out of time is not actually a bridging loan, the next section sorts that out first and sends you to the right page.
| Where you are | What is actually happening | Your first move |
|---|---|---|
| The term ends soon and the property is listed | The facility is still performing, so you are asking the lender to vary a good loan rather than to forbear on a bad one | Ring the funder now and put the request in writing while that is still true. This is the cheapest week of the whole process |
| The term has passed and the lender has not contacted you | Silence is not forbearance. The debt is due against both titles and interest is accruing with no budget behind it | Ask for a written payout figure to a nominated date, and get the sale campaign into evidence before you are asked for it |
| A letter has arrived from the lender | The document decides your timetable. A default notice under the National Credit Code runs at least 30 days. A contractual demand on a business purpose facility may run far less | Identify which instrument you are holding, diarise the date on its face, and take it to a solicitor the same week |
| The old property is under contract but settlement lands after the payout date | A timing problem rather than a solvency problem, and the cheapest of the six to fix | Send the funder the contract and the settlement date and ask for an extension to that date specifically, not an open-ended one |
| The best offer you have will not clear the debt | A shortfall, not an expiry. Selling into it does not end the debt, it converts it | Price the refinance and the shortfall in parallel before you accept or reject the offer, because both change what the offer is worth |
| Possession has already been taken | The dispute scheme can no longer suspend what has been enforced | This stops being the right page. The mortgagee in possession guide takes over from here |
How to read this table: General sequencing only, not advice on your facility. Which instrument you hold, and what your contract allows, are the two things that decide your actual timetable, and both are answered by reading your own documents.
Two things are worth saying about that table before you go further. The first is that the top three rows are the same file at three different stages, and the cost of moving between them is not gradual. The second is that rows four and five are commonly misread as each other: a settlement that lands 2 weeks late is a timing conversation, while an offer that will not clear the debt is a shortfall and refinance question.
My bridge expires in the next 30 days and I still have no buyer. What should I do?
Treat the next 30 days as a finance deadline, not only a property-sale deadline. Contact the funder before maturity, ask exactly what an extension or reassessment requires, obtain a payout figure to a future date, and price a refinance at the same time. Do not wait for the extension answer before testing the refinance, because the two processes use many of the same documents and the value of having a second exit is highest before the loan is in default.
- Ask the agent for written campaign evidence: days on market, enquiry volume, inspections, offers, feedback and the current recommended asking range.
- Ask the funder for its expiry position in writing: extension, reassessment, fresh interest budget, new repayment amount, or no extension.
- Request a dated payout figure and daily accrual: this turns every extra week into a number you can compare with a price change.
- Test a refinance before maturity: valuation, serviceability, exit and first mortgagee consent can all take time even where the incoming lender is fast.
- Set a decision date before the maturity date: the date on which you will reduce price, change campaign, refinance, retain the property or sell the other security rather than simply keep waiting.
Is your deadline actually a bridging loan?
This guide focuses on the common buy-before-sell bridge where the lender takes security over both the existing property and the new property, or otherwise underwrites repayment from the sale of the existing property. Bridging structures are not identical, so check the mortgages and securities actually listed in your own facility documents rather than assuming every bridge is secured in the same way. Moneysmart describes bridging finance as short term finance covering the period between buying a new property and selling your existing one. If your deadline instead sits on a term loan, overdraft, covenant, construction facility or settlement contract, use the closer guide below.
This page is for you if
- Your loan was written to bridge a purchase and a sale
- Your loan was underwritten on the sale or refinance of an existing property
- The lender may hold security over both properties, depending on the structure
- Your interest may be capitalised, prepaid or paid monthly
- The old property is still on the market, or not yet listed
- The maturity date has passed, or is close
Try one of these instead
- A balloon payment falling due if a lump sum has fallen due on a term facility
- A covenant breach or interest only expiry if a covenant or an interest only period has run out
- A business facility that will not be renewed if the bank has told you it will not roll your facility
- A development facility expiring before completion if a construction facility runs out before practical completion
- Penalty interest on a late settlement if the pressure is on a settlement date rather than a loan term
Two more near misses worth naming. If a caveat loan rather than a bridge is the facility expiring and you cannot repay it, the mechanics differ because a caveat is not a registered mortgage, and our guide to exiting and discharging a caveat loan covers the discharge side. And if the problem is that a valuation came in under the purchase price rather than that a term expired, the valuation shortfall guide is the page that answers it.
One last check, and it is a wrong country rather than a near miss. Bridging is a far larger market in the United Kingdom than in Australia, and British pages answering this exact question rank and get cited on Australian searches. If the page you are reading refers to the Financial Conduct Authority, quotes fees in pounds, or draws a distinction between regulated and unregulated bridging, it is describing a different statutory regime and none of it governs an Australian facility.
What happens on the maturity date when the property has not sold?
On the maturity date, the bridging loan normally becomes due and payable under its contract. The property is not automatically sold and enforcement does not happen merely because the date has passed, but contractual consequences can begin immediately. Depending on the facility, repayments may become due, interest may continue without a prepaid budget behind it, a default rate may apply, or the lender may start the contractual recovery process. On the common two-security structure covered here, both titles remain exposed until the facility is repaid or varied.
That is why the first move belongs to you rather than to the lender. The borrower who contacts the funder before maturity is usually asking for a variation or reassessment of a performing loan. The borrower who waits until after maturity may be asking the same credit team to tolerate an already due debt. The documents can look similar, but the risk decision is not.
What to do in the first week
- Read the maturity clause and the default clause together, not separately. One tells you when the debt falls due and the other tells you what the lender may charge and do once it has.
- Ask for a written payout figure to a date several weeks out, not the balance on your statement. Our glossary entry on the payout figure explains why the two are different numbers, and section eight below covers what inflates the payout on an expired bridge specifically.
- Ask the funder, in writing, what it needs in order to extend. Almost every non-bank page we read invites early contact, and almost none publishes the price of it.
- Get the sale campaign into evidence. An agency agreement, a marketing schedule, offers received, feedback in writing. A file with a listing and an agent is a different risk from a file with neither.
- Test the refinance in parallel, not afterwards. If the answer is a new facility rather than an extension, you need it approved before the forbearance runs out, and private lending is the lane most of these land in.
- Decide who sells, and say so. Section nine sets out what a lender-run sale costs you that your own sale does not, and that decision is much cheaper made early.
What to ask the funder on the first call, and in what words
The call is the part nobody prepares for, and an unprepared call produces a sympathetic conversation and no information. Five things are worth asking for by name, and asking for them in writing turns each answer into something you can act on rather than something you half remember.
| Ask for | Put it roughly like this | What the answer gets you |
|---|---|---|
| A dated payout figure | Please send a payout figure calculated to a date I nominate, and tell me what accrues each day after that date | The forward number instead of the historical balance, and the daily cost of every week you spend deciding |
| The current rate and when it changed | What rate is the facility accruing at now, and from what date did it change? | Whether a default margin is already running, which most borrowers discover only at discharge |
| The extension criteria | What do you need from me to consider an extension, and what would it cost? | A list you can satisfy, instead of a vague conversation you cannot act on |
| The payout clause and the minimum interest provision | Please send me the payout clause and any minimum interest provision from the contract | The two lines that actually decide your exit number, which are rarely in the rate schedule |
| The point at which control of the sale changes | If I cannot repay at the end of any extension, at what point does the sale stop being mine to run? | The date your choice disappears, told to you before it does rather than after |
How to read this table: Practitioner framing, not lender policy. What any funder will tell you, and how quickly, depends on its own process and on your contract. Put every one of these in writing after the call and ask for a written reply.
The property has sold, but settlement is after the bridge expiry date. What happens?
If you have an unconditional sale contract that will repay the bridge but the settlement date lands after maturity, you usually have a timing problem rather than an unsold-property problem. Send the lender the signed contract, settlement date, conveyancer details and an updated payout request immediately. Ask for a variation or extension to the specific settlement date plus a sensible buffer, rather than an open-ended extension. The lender still decides whether it will agree, but a documented repayment date is a materially different file from a property with no buyer.
What should you send with an extension or refinance request?
Send the evidence that answers the lender's next question before it asks. A clean pack lets an extension, refinance or forbearance request be assessed as a plan rather than as a plea for more time.
- Current payout figure to a nominated date, plus the daily accrual after that date.
- Sale evidence including agency agreement, listing, campaign history, written offers and buyer feedback.
- Signed sale contract if exchanged, with settlement date and any conditions still outstanding.
- Current property position including the latest valuation or appraisal where available and any material change since settlement.
- Income and business evidence if a refinance or full reassessment is being considered, especially for a self-employed borrower.
- A written exit plan with dates: sell, refinance, retain and refinance, or sell the other property if that is genuinely being considered.
One caveat, in the literal sense. If the funder behind your bridge took a caveat rather than a registered second mortgage, or if a caveat sits behind the bridge, the expiry conversation runs through the caveat's own discharge mechanics as well as the loan's. Our bridging, caveat or second mortgage chooser is the page that sorts out which instrument you are actually dealing with, and caveat loans is where the urgent end of that lane lives.
What happens to interest after a bridging loan expires?
If your bridge uses prepaid or capitalised interest, the interest budget funds a defined period rather than guaranteeing that the sale will happen inside it. When that funded period is exhausted, the next interest treatment comes from the contract: interest may continue to accrue, repayments may switch on, and a default margin may apply if the facility permits it.
Many specialist bridges either pre-fund interest at settlement or capitalise it into the balance, but that is not universal. Some bridging products require monthly interest-only repayments instead. On a capitalised facility, interest added to the balance can keep compounding while the debt is already near its peak. Our glossary entry on capitalised interest covers that mechanism.
What a lender may then do is set out in the contract rather than in legislation, and one major bank publishes its version of it. Three levers appear there, and they are typically available together rather than in sequence.
| The lever | What it means for your balance | What to ask |
|---|---|---|
| It may help arrange the sale | Control of the campaign starts moving toward the lender well before anything formal happens, which is the quiet version of section nine | Is this offered or imposed, and who appoints the agent and sets the reserve? |
| It may apply a higher default interest rate above the annual percentage rate applying at the time | The rate you signed stops being the rate you pay, and on a capitalised facility the increase compounds into a balance already at its peak | What is the default rate, in writing, and from what date does it run? |
| It may adjust the rate to remove any discretionary margin | Any negotiated discount can come off. This is separate from a default margin and can sit on top of one | What would my rate be with every discretionary margin removed? |
How to read this table: Source: Westpac bridging loan page, read 15 September 2026, named here because a source cell is the one place a lender may be named. We publish no figure for any of these levers, because the rate depends on your contract, your funder and the market at the time, and because the numbers circulating on broker blogs are not sourced to any lender's own document. Your own facility may differ in all three respects.
What if your bridge has monthly interest-only repayments instead of capitalised interest?
Then there may be no prepaid interest budget to run out. The maturity question becomes: what payment is due from the day after maturity, does the interest rate change, and does the contract move the loan into default or recovery? Ask for those three answers in writing. A borrower already making monthly interest-only repayments can still face an expiry problem, but the cash-flow shock is different from a borrower whose interest had been hidden inside a capitalised balance.
Can a bridging loan be extended?
There is no single Australian rule saying a bridging loan can or cannot be extended. It is product-specific and contract-specific. Published Australian product positions range from a maximum term that generally cannot be extended, to an extension requiring full reassessment and new documents, to a case-by-case extension of the interest budget. That is why you should ask what your actual product permits before assuming an extension is available.
| Published or contractual position | What it means for you | What to ask next |
|---|---|---|
| No extension above a product maximum | You need a sale, refinance or other exit before the maximum date rather than relying on another month | What exact date is the maximum term, and what happens the day after it? |
| Extension requires full reassessment | Treat it as a fresh credit decision with updated documents, valuation and establishment costs rather than an administrative date change | What documents, valuation and fees are required, and when must the reassessment be approved? |
| Fresh interest budget may be considered | The existing structure may continue for another approved period, but the new interest cost has to be funded and approved | How much new interest is being budgeted, at what rate, and what happens if that period also expires? |
| Case-by-case forbearance or variation | The lender may tolerate the existing loan for a defined period while a sale or refinance completes, but the terms are negotiated rather than automatic | What is the final date, what accrues in the meantime, and what event ends the arrangement? |
How to read this table: These are different extension structures, not four steps in one process. Current Australian lender pages and broker documentation show materially different published positions. Your own contract and lender decision control your result.
How much does it cost to extend a bridging loan?
There is no standard Australian extension price. The cost can include a fresh interest budget for the new period, an extension or establishment fee, a new valuation, legal or documentation costs and any higher rate or default margin that applies under the variation. Ask for the total dollar amount to the new maturity date, not only the new interest rate, because a cheaper rate with another establishment fee can still produce a higher exit cost.
From our broking, indicative
What we see on this lane is about sequence rather than pricing, so this block carries no rates, bands or timeframes at all.
- The borrower who telephones the funder before the maturity date is in a materially different conversation from the one who telephones after it.
- The funder's first question is almost always about the sale campaign rather than about the borrower's income.
- An unsold property with no listing and no agent is the file that hardens fastest.
Indicative only, drawn from files we have worked on rather than from any lender's published policy. Not a quote and not an offer. What your funder will do depends on your contract, its policy and your circumstances at the time. General information only, not financial advice.
Two points of discipline here. Settlement-side penalty interest is a different animal with a different source, and it lives in the penalty interest guide. And if what you are really facing is a lender exiting the deal rather than repricing it, the exit plans private lenders actually want is the honest next read.
Does the National Credit Code default notice apply to your bridge?
The section 88 default-notice protection applies only if the National Credit Code applies to the facility. It does not turn simply on whether the lender is a bank, non-bank or private funder. If the Code applies, the credit provider generally cannot begin enforcement proceedings for the default until a compliant notice has been given and the remedy period has expired, subject to the statutory exceptions. If the Code does not apply, the timetable is instead driven by the contract and other applicable law. Whether your bridge is regulated credit or a business purpose loan is the first question on the bridging finance without a bank guide.
Section 5 of the Code, headed "Provision of credit to which this Code applies", sets the test. The borrower must be a natural person or a strata corporation, a charge must be or may be made for the credit, the credit provider must provide the credit in the course of a business of providing credit, and the credit must be provided wholly or predominantly for one of three purposes: personal, domestic or household purposes; to purchase, renovate or improve residential property for investment purposes; or to refinance credit provided wholly or predominantly for those purposes. The third limb is the one broker pages routinely drop.
Where the Code does apply, section 88 is the protection, and its heading is worth quoting because it describes the whole mechanism: "Requirements to be met before credit provider can enforce credit contract or mortgage against defaulting debtor or mortgagor". A credit provider must not begin enforcement proceedings unless the borrower is in default, the provider has given the borrower and any guarantor a default notice complying with the section "allowing the debtor a period of at least 30 days from the date of the notice to remedy the default", and the default has not been remedied in that period. The same requirement is repeated for enforcement against a mortgagor, including taking possession, selling, appointing a receiver or foreclosing. Both carry a criminal penalty of 50 penalty units.
Section 88(3) prescribes what the notice must contain, and the list is a checklist you can hold a notice against: a prominent heading at the top stating that it is a default notice, the default, the action necessary to remedy it, a period for remedying it, the date after which enforcement and any repossession may begin, that repossession and sale may not extinguish the debtor's liability, prescribed information about the right to give a hardship notice or a postponement request or to apply to the court, prescribed information about the AFCA scheme and the debtor's rights under it, that a further default of the same kind in the period may be enforced without further notice, and that a credit reporting body may collect and hold default information. Section 88(5) then lists the narrow cases where no notice is required at all: a reasonable belief of fraud, reasonable but unsuccessful attempts to locate the borrower, court authorisation, or a reasonable belief that mortgaged goods have been or will be removed or disposed of without permission, or that urgent action is necessary to protect the mortgaged property. Read against the current compilation of the Act, current compilation dated 1 July 2026, read the section on the Federal Register of Legislation.
Two items in that list are levers rather than formalities, and both are commonly read past. The first is the hardship notice. On a Code-regulated facility it can create additional requirements before enforcement, but it is not a universal freeze and it does not force the lender to agree to an extension. The second is the reference to a credit reporting body, dealt with below.
Can a hardship request delay enforcement after a bridging loan expires?
On a bridging loan covered by the National Credit Code, a valid hardship notice can add another step before enforcement, but it does not automatically extend the loan or guarantee that the lender will change the contract. Section 72 (Changes on grounds of hardship) says a debtor who considers that they are or will be unable to meet their obligations may give the credit provider a hardship notice orally or in writing. The lender may ask for relevant information, and it does not have to agree to a change simply because a hardship notice has been made.
Section 89A (Effect of hardship notices on enforcement) is the enforcement link. Where section 88 requires a default notice, and the conditions in section 89A are met, the credit provider must not begin enforcement proceedings until it has responded to the hardship notice with a notice saying no change was agreed and at least 14 days have passed from that response. Section 89A also limits repeated notices: broadly, the additional protection applies where there was no other hardship notice in the previous 4 months, or where the lender reasonably believes the basis of the new notice is materially different.
| Provision | What it does | What it does not do |
|---|---|---|
| Section 72 (Changes on grounds of hardship) | Lets a debtor tell the credit provider, orally or in writing, that they are or will be unable to meet obligations and starts the lender's hardship-response process | It does not force the lender to agree to an extension, refinance or other change |
| Section 88 default notice | Where the Code applies, generally requires a compliant default notice with at least 30 days to remedy before enforcement, subject to the statutory exceptions | It does not mean every bridging loan is regulated credit |
| Section 89A (Effect of hardship notices on enforcement) | Where its conditions are met, prevents enforcement from beginning until the lender has issued the relevant refusal notice and 14 days have passed | It is not an indefinite pause, and repeat hardship notices inside 4 months do not automatically produce the same protection |
How to read this table: Read against sections 72, 88 and 89A of the National Credit Code, Compilation No. 52, 1 July 2026. This is general information only. Whether the Code applies to your bridge, whether a hardship notice satisfies the section, and what an enforcement timetable means for your property are legal questions to take to a solicitor.
If the bridge is genuinely outside the National Credit Code, these statutory hardship provisions may not apply. You can still ask the lender for a commercial variation or forbearance, but do not assume that calling it a hardship request creates the same legal timetable. If you need the statutory protection, make the request clearly, keep a written record even if you first make it by phone, answer reasonable information requests quickly, and ask the lender to confirm its decision in writing.
Will an expired bridging loan show on your credit file?
It can, and the statute contemplates it plainly. Section 88(3) requires a regulated default notice to state that a credit reporting body may collect and hold default information about the borrower under the Privacy Act 1988, which is the Code telling you in advance what the consequence of an unremedied default is. On a facility written for a business purpose the reporting question runs through your contract and the funder's own arrangements rather than through the Code, so the answer is in the documents rather than in the legislation.
We publish no retention period here, because the periods in circulation do not agree and we have not verified one against the regulator's current position. What is worth doing instead is asking the funder, in writing, whether and at what point it reports, and asking during the remedy period rather than after it, because the answer changes what remedying the default is worth to you.
The business purpose declaration is not the end of the argument
Most private and non-bank bridging is written on a declaration that the credit is for a purpose that is not a Code purpose, which takes it outside all of the above. But section 13, headed "Presumptions relating to application of Code", carries a hinge that almost nothing in this lane mentions. Under section 13(3) the declaration is ineffective if, when it was made, the credit provider knew or had reason to believe, or would have known or had reason to believe had it made reasonable inquiries about the purpose, that the credit was in fact to be applied wholly or predominantly for a Code purpose. Section 13(4) then deems the section 5 purpose test satisfied. Section 13(5) adds that a declaration not substantially in the form required by the regulations is ineffective for these purposes. So a declaration signed over a loan that plainly refinanced a home is not a shield, and the Code can reach the facility after the fact.
That is a legal question rather than a broking one, and it is the point on this page where a solicitor earns their fee. Our glossary entry on default is our neutral entry on what default means, and the table below is the comparison the fragments never make in one place.
| The question | Regulated by the National Credit Code | Written on a business purpose declaration |
|---|---|---|
| Who the borrower must be | A natural person or a strata corporation | Any borrower, including a company or a trustee |
| What the credit must be for | Personal, domestic or household purposes, or purchasing, renovating or improving residential investment property, or refinancing such credit | A purpose the borrower declares is not a Code purpose |
| Default notice before enforcement | Required under section 88 | Not required by the Code, unless the declaration is ineffective |
| Minimum time to remedy | At least 30 days from the date of the notice | Whatever the contract allows, which may be far shorter |
| What the notice must contain | The prescribed contents in section 88(3), including a prominent default notice heading and prescribed AFCA scheme information | No prescribed contents at all |
| Whether you are told about hardship and credit reporting | Yes. Both are prescribed contents of the notice itself | Only if your contract says so |
| When no notice is needed | Only the narrow cases in section 88(5): fraud, inability to locate you, court authorisation, or removal of mortgaged goods or urgent action to protect the property | Not applicable |
| Whether the protection can come back | It already applies | Yes. Section 13(3) voids the declaration where the lender knew, or would have known on reasonable inquiry, that the credit was for a Code purpose, and section 13(4) then treats the Code purpose test as satisfied |
| Penalty for enforcing without a notice | A criminal penalty of 50 penalty units on the credit provider | No statutory penalty, because no statutory notice is owed |
| Dispute scheme access | AFCA, because a credit licence requires membership | Only if the funder happens to hold a credit licence |
How to read this table: Read against the National Consumer Credit Protection Act 2009, Compilation No. 52, checked 15 September 2026. This is the general position, not advice on your facility, and whether your own declaration is effective is a question for a solicitor.
What are your three main ways out of an expired bridging loan?
There are only three: it is repaid from a sale, it is refinanced into another facility, or it is extended. Everything else is a variation on one of those three, and every one of them gets easier the earlier it is started. The reason it is worth naming them as a set is that most people arrive holding only one of them, usually the sale, and spend weeks on it without pricing the other two.
Before any of the three, though, four levers are available that do not involve borrowing anything, and on a good number of files one of them is the answer.
- Re-test the price against the market rather than against what you paid or hoped. The funder's first question will be about the campaign, so you will be having this conversation anyway. Having it first is better than having it second.
- Change the method, the agent, or both. A campaign that has run its course rarely improves by continuing unchanged, and a lender reading your extension request can tell the difference between a plan and a wait.
- Re-read the offer already in front of you. The question is not whether it is the price you wanted. It is whether the gap between that offer and a better one later is bigger than what the facility now costs in the meantime, at the rate it is now accruing. That is arithmetic you can do with your own contract and your own payout figure, and it is worth doing before you reject anything.
- Ask whether you are selling the right property. A bridge is secured over both titles, so from the lender's point of view the debt can be retired by a sale of either one. Selling the newly purchased property is the option almost nobody says out loud, and on some files it is the cleaner exit. The tax and duty consequences of selling a recently purchased property are a question for your accountant, not your broker, and they are worth asking before an extension is priced rather than after.
| The way out | What the funder needs to see | What it costs you | Where it usually fails |
|---|---|---|---|
| Repay from the sale | A contract, a settlement date, and a price that clears the payout figure rather than the statement balance | Interest to the discharge date, plus whatever the payout clause adds | Settlement lands after the payout date, or the price clears the balance but not the payout |
| Refinance to another facility | Serviceability or an exit the incoming lender believes, a valuation that supports the new loan, and time to settle | New establishment costs, a rate set by whoever will take the risk today, and two discharges to register | Started too late. A refinance needs to be approved before the forbearance runs out, not after |
| Extend the bridge | Evidence the sale is alive: an agency agreement, a marketing schedule, offers and written feedback | A fresh interest budget priced against today's appetite, fees, and sometimes a revaluation | Asked for after maturity rather than before it, or asked for with no campaign to point at |
How to read this table: General mechanics only. No lender is named and no cost is quantified, because each of these is set by your contract and by the appetite of whoever is being asked at the time.
Where the answer is a refinance, the realistic lane for a self-employed borrower carrying two properties may include private lending or a second mortgage where mainstream timing or serviceability does not fit, and if your existing first mortgagee has to agree to anything, first mortgagee consent is the constraint to check early.
Can you refinance a bridging loan after it has already expired?
Yes, in principle, if an incoming lender will approve and settle the new facility before the outgoing lender ends any agreed breathing room. Expiry does not make refinance mathematically impossible, but it makes timing and evidence more important. The incoming lender will still test security value, the proposed exit, serviceability where relevant, existing mortgagee consent and the amount needed to clear the outgoing payout figure. Ask the outgoing lender for a payout figure that remains valid long enough for the refinance process, and do not mistake an application in progress for an agreed extension.
Should you accept a lower offer or pay for another month of bridging interest?
Compare the certain cost of waiting with the realistic extra sale price you are waiting for. Do not compare the offer only with your original asking price. Start with the funder's daily accrual from the payout figure, then add the property costs and campaign costs that continue while you wait. That gives you the minimum extra sale price the next month has to produce before waiting is financially better.
If the current offer will not clear the payout figure, the decision changes again. A lower offer can crystallise a shortfall that still has to be funded or negotiated, so ask the lender what sale price it will release the security at, obtain an updated payout figure and price the shortfall refinance before accepting or rejecting the offer. Our payout shortfall guide covers that calculation in more detail.
Can you keep the old property instead of selling it?
Sometimes, but that converts the problem from a sale exit into a refinance and serviceability problem. The incoming lender has to be comfortable with the debt that remains when both properties are retained, the rental or other income assumptions it is prepared to use, and the resulting loan to value position. That is why retain and refinance sits underneath the refinance path rather than as a separate fourth type of exit.
What did this look like on a real file?
On a file this desk worked in 2026, a borrower came to us to refinance out of a non-bank bridging facility that was about to expire, secured over one home at about 52 per cent of its value. The equity was not the problem. The exit was: the borrower had told one adviser the home would be sold this year and another that it would be kept and rented, and an incoming lender cannot price a 30 year loan for a borrower in their late sixties without a documented exit. The file stalled on that question, not on the payout figure. Settle the exit before you ask for the refinance, because it is the first thing the incoming lender tests.
Indicative, anonymised, based on a file this desk worked in 2026. Not a quote, not an offer, and not a limit you will be given. Actual outcomes depend on lender policy, the valuation and your circumstances at the time of application.
What does a non-bank lender do at the end of a bridging term?
There is no single published Australian non-bank rule for what happens at bridging expiry. In the lender documents reviewed for this guide, one non-bank lender expressly states that repayments become required on the peak or actual debt at expiry, while other consumer-facing lender documents do not state an equivalent rule at all. The useful finding is therefore not that every non-bank lender does the same thing, but that the term-end consequence can be product-specific and may be documented more clearly in broker material than on the public product page.
Four document classes were read on the day this guide was built: the live consumer-facing bridging product pages of three Australian non-bank and private lenders, one major bank's consumer bridging page and fact sheet, a consumer-facing Target Market Determination for a comparable bridging product, and one non-bank lender's broker-facing product documentation. The first three publish the term, the interest structure and the loan to value ceiling, and say nothing at all about the property not selling. The fourth answers it under a heading of its own.
The disclosure document is the sharpest part of that. A Target Market Determination is mandated, written for consumers, and exists to set out who a product suits and who it does not. This one publishes the term, the ceiling, the fees, the repayment type and the ability to capitalise interest to the end of the term. It never says what happens if the sale does not happen, and it lists an increase in the number of defaults among its own review triggers. The document contemplates the event without ever describing it to the borrower.
| What a borrower looks for | Consumer-facing pages and disclosure documents | Broker-facing product documentation |
|---|---|---|
| Maximum term | Published on every page read and in the disclosure document | Published, with longer periods described as a matter to be discussed case by case |
| Interest budget and capitalised interest | Published, including the ability to capitalise interest to the end of the term | Published, and described as the mechanism that removes repayments during the bridging period |
| Loan to value ceiling | Published, against peak debt on one page and assessed value on another | Published, and tiered by loan size and by whether the security is residential or commercial |
| The exit being underwritten | Named openly as sale of the security, refinance, or completion of a transaction | Named, with the residual debt position after the sale set out separately |
| What happens if the property is not sold at expiry | Nothing on any page or disclosure document read | Answered under its own heading. Repayments become required on the peak or actual debt, and the borrower is told to make contact before expiry |
| Extension | Considered case by case, with early contact invited | Described specifically as an extension to the interest budget, to be raised before expiry rather than after |
| Default interest rate | Nothing on any page or document read | Nothing |
| Discharge cost when the sold security is released | Nothing on any page or document read | One document states that no early repayment fee applies on the partial discharge |
| External dispute scheme | Nothing on any page or document read | Nothing |
How to read this table: Source: La Trobe Financial, Well Money and ORDE Financial bridging pages, the Westpac bridging page and fee sheet, and MA Money's broker bridging page and Target Market Determination, all read 15 September 2026. Lenders are named here because a source cell is the one place a lender may be named; no figure from any of these documents is reproduced in the table. Broker-facing documentation is written for accredited brokers rather than for borrowers, and none of these positions is your contract.
Two different things can happen at term end, so ask which one applies to you
The bank levers in section four and the non-bank position above are not the same event, and confusing them will cost you the wrong preparation. One is a repricing: the rate moves, discretionary margins come off, and the lender may involve itself in the sale. The other is a repayment obligation switching on. The interest budget that was covering the loan is exhausted, so repayments become payable, and they are calculated on the peak debt rather than on the smaller balance you will be left with once the old property sells.
That second one catches people hardest, because it reverses the thing they were told at settlement. A borrower who understood that no repayments were required during the bridging period is rarely told that the day the period ends is the day that stops being true. Both consequences can apply to the same facility and neither is universal, so the question to put to your funder is the specific one: on the day after the term ends, does this facility begin requiring repayments, does it begin accruing at a higher rate, or both?
The practical reading is that a document written for the distribution channel is often more candid than the one written for you, so ask your broker what the lender's own product documentation says about term end. Brokers hold material that consumer pages do not carry, and this is precisely the question it answers. Planning the exit before you sign a short term property loan is the page that sets out how to test an exit before rather than after.
If the asset behind the bridge is a build rather than a home, the term end conversation runs differently again, and bridging finance for builders is the closer read.
Why does an expired bridge's payout figure exceed the balance you expected?
Because a payout figure is not a balance: it adds interest to the discharge date, capitalised interest already inside the balance, any unused minimum interest period, two discharge registrations and any default margin since maturity, and on an expired bridge that gap is at its widest. A statement balance is a historical position at a past date. A payout figure is a forward quote: what the lender needs, on a nominated future date, to release both titles and close the facility. On a bridge that has run past its term, four things sit inside the gap, and every one of them was contracted for at settlement rather than added afterwards.
| What is in there | Why it is in there | What to ask the lender |
|---|---|---|
| Interest to the discharge date, not to the statement date | Once the interest budget is spent, interest runs day by day until the money actually arrives, so a payout quoted to a date you then miss is not the payout you pay | Give me the figure to a specific date, and tell me the daily accrual after it |
| Capitalised interest already inside the balance | If interest was added to the loan rather than paid monthly, part of what looks like principal is interest that has been compounding since settlement | How much of the current balance is capitalised interest rather than principal? |
| Any minimum interest period the contract has not yet used | Short term facilities commonly guarantee the funder a minimum earn, and a discharge inside that window does not reduce it. This is the line most often missed, because it sits in the payout clause rather than the rate schedule | Is there a minimum interest period, and how much of it is unused? |
| Discharge costs and any default margin already accrued | On a two property facility there are two discharges to register, and a lender that has moved the file to recoveries will normally pass through the cost of doing so | What are the discharge and legal costs, and has a default margin been running since maturity? |
How to read this table: General mechanics, not your facility. Every line here is governed by your own contract, and the payout clause is the provision that decides all four.
There is one more line we will not tell you the answer to, because no source does. Across the lender documents read for this cluster, none publishes a rule for how unused prepaid interest is treated on discharge, and two contradictory positions circulate freely: that it is refunded, and that it is credited against the payout. Your contract's payout clause is the only source that governs you. Ask for that clause in writing, and ask the question before you set a discharge date. One non-bank lender's broker-facing documentation does state that no early repayment fee applies when the sold security is partially discharged, which tells you the position is not uniform across the market. It does not tell you what yours is.
What does a lender-run sale cost you that your own sale does not?
It costs you the agent, legal and enforcement charges added to the debt, the default interest running through the campaign and, most of all, the price, because once an enforcing mortgagee controls the sale you no longer control the sale process in the way an ordinary vendor does. The mortgagee chooses how to exercise its power subject to its legal duties, while interest, enforcement, legal and selling costs may continue to affect the debt under the contract and applicable law. The practical loss is therefore not only price risk. It is the loss of your ability to decide how long to wait, which offer to prefer and whether to change the campaign.
This guide deliberately stops short of the statutory side. The power of sale, how possession is obtained, the order in which sale proceeds are applied, and who receives a surplus or bears a shortfall are all answered properly in our mortgagee in possession guide, and repeating them here would help nobody. What follows is the cost and control comparison, which that page does not make.
| What changes | You run the sale | The lender runs the sale |
|---|---|---|
| Who appoints the agent | You do, and you can change agents | The lender does, often from a panel |
| Who sets the method and reserve | You do, subject to the market and your finance deadline | The mortgagee controls the sale strategy, subject to its legal duties |
| Marketing period | You decide how long to continue, while the facility allows it | You no longer decide the timetable; the mortgagee manages the sale process |
| Valuation and price evidence | You can obtain your own appraisals and decide how much weight to give them | The mortgagee may obtain and rely on its own valuation and sale advice when exercising the power of sale |
| Selling and enforcement costs | Ordinary vendor and discharge costs are borne by you | Additional enforcement, legal and selling costs may be recoverable from the secured debt under the documents and applicable law |
| Interest while it sells | Accrues against you, and you control the clock | Accrues against you, and you do not |
| Your ability to withdraw the property | Yours to decide | Gone |
| Your negotiating position | You can choose to reject an offer and continue the campaign while your finance allows | You no longer control whether waiting for another buyer is worth the extra time and cost |
| AFCA and enforcement timing | A complaint may be able to affect recovery while the matter is still within AFCA's jurisdiction | AFCA says it cannot intervene where a default judgment or warrant of possession has already been enforced and the firm has taken possession of the security property |
How to read this table: Cost and control only. It deliberately avoids claiming that every mortgagee uses the same agent, campaign length or valuation basis. The statutory power of sale, the duty on sale, application of proceeds and any surplus or shortfall are covered in the mortgagee in possession guide linked above.
The last row is the one worth acting on, and it is not our opinion. AFCA's own published guidance on delaying enforcement says that suspending enforcement may be appropriate where a borrower is actively taking steps and needs more time to sell the security property themselves within a reasonable time, to finalise a refinance, to organise their affairs, or to apply to have a judgment set aside. It also says that where a firm has already enforced and taken possession of the security property, it is unable to intervene. The window has a closing time, and taking possession is what closes it.
If you are on the other side of this, buying rather than selling, or if a notice to complete is what is actually driving the timetable, the notice to complete guide is the page for the settlement-side clock.
Is your bridging lender an AFCA member, and does a complaint stop them selling?
Do not use National Credit Code status as a shortcut for AFCA membership. They are different questions. Australian credit licensees must have an AFCA dispute-resolution arrangement, but a particular business-purpose loan being outside the Code does not by itself tell you whether the financial firm is or is not an AFCA member. Check the firm separately, and check it before you need the complaint process.
ASIC states that credit licensees must have appropriate dispute-resolution systems including AFCA membership. A funder writing business-purpose credit may or may not operate under a credit licence depending on the activities and structure involved, so do not infer membership from the words "business purpose" alone. Search ASIC's registers and check the financial firm itself. ASIC's ongoing credit licence obligations set out the membership requirement for credit licensees.
On what a complaint does, AFCA's guidance for credit, finance and loan complaints is direct: your financial firm is required to suspend any collection or recovery action once your complaint has been registered with AFCA. The same page adds that you should make whatever payments you can, because interest and fees will usually continue to be charged to your account while the complaint is open, and arrears that keep growing leave you worse off. So a complaint buys time on recovery; it does not freeze the debt.
What it cannot do is suspend an order that has already been enforced. AFCA states that where a financial firm has already enforced a default judgment or warrant of possession and has taken possession of the security property, it is unable to intervene because the enforced order cannot be suspended. That is narrower than saying "AFCA stops helping the moment possession is taken", and it is the wording worth holding onto when timing a complaint.
Worth knowing too that AFCA lists the financial hardship complaints it can consider: a declined hardship request, a default notice received while you are in hardship, no response to a request for assistance, and a firm that continues recovery action after a hardship request has been made. Two of those four only exist if you made a hardship request in the first place, which is the practical reason to make one rather than to read past the line in the notice. A default notice is itself a category, which is a reason to keep the notice rather than to put it in a drawer.
We publish no monetary threshold for the scheme anywhere on this page, because the figures in circulation do not agree and we have not verified one against the current Rules. If a compensation limit matters to your situation, read it off AFCA's own Rules rather than off a broker page, including ours.
How do you structure the next bridge so the term cannot run out on you?
You size the term to a realistic sale campaign plus a contingency, and you agree the extension mechanics before you sign rather than after you need them. Almost every expired bridge we see was a term set to the optimistic case. How long a home actually takes to sell, and how that should set the term, is in buying before selling when self-employed.
Work backwards. Take the time an honest agent says the property will take to sell in the current market, not the time you hope it takes. Add the settlement period. Add a contingency for a buyer falling over, because that is the ordinary case rather than the unlucky one. That total is the term you need, and if the facility on offer is shorter, the gap is a risk you are carrying, not one the lender is.
| What to agree | The question that settles it | What agreeing it prevents |
|---|---|---|
| What an extension costs, and what triggers it | If the property has not sold by the maturity date, what does an extension cost and what do you need from me to grant one? | An extension negotiated in advance is a variation. One negotiated late is a concession, and it is priced like one |
| How the interest budget is sized, and what happens when it runs out | How many months of interest are being funded, and what accrues from the day after the last of them? | Discovering at the payout figure that the facility stopped being pre-funded months ago |
| Whether a revaluation can be called, and on what basis | Can you require a revaluation during the term or at extension, and is it market value or a forced sale assessment? | A revaluation on a different basis resetting your position at the worst moment |
| What the payout clause says about minimum interest and unused prepaid interest | Show me the payout clause and the minimum interest provision before I sign | The single line that surprises people on the way out of a bridge |
How to read this table: What any lender will agree to is a matter for that lender and your negotiation. The value here is in asking the four questions before settlement, not in any particular answer.
Finally, have a second exit that does not depend on the sale. An exit strategy is the discipline, and in practice the fallback is either a refinance to a longer term facility or a hold. Where the fallback is a refinance, checking eligibility is the faster way to find out which lane you are in.
Where this commonly lands: the borrowers who come through an expired bridge in reasonable shape are not the ones with the strongest balance sheet. They are the ones who had already decided, in writing, what they would do if the property did not sell. Buying before selling while self-employed is the right first read before the next one, and the short term loan definition is worth holding against your own facility while the term is still running.
Which primary sources should you check against your own facility?
Use this guide to identify the question, then use your contract and the primary source to verify the answer that applies to you. The legal and dispute-resolution parts of this page were checked against Australian legislation, ASIC and AFCA material current when the guide was reviewed. Lender term-end and extension positions were checked against current Australian lender product pages, disclosure material and broker documentation, but those documents are examples of different product structures rather than rules for the whole market.
- National Consumer Credit Protection Act 2009 and National Credit Code for Code coverage, business-purpose declarations, default notices and enforcement requirements.
- ASIC credit licence obligations for dispute-resolution and AFCA membership obligations applying to credit licensees.
- ASIC's published hardship-notice guidance for how section 72 hardship notices work in practice and the lender's response obligations.
- AFCA credit, finance and loan complaints for what happens to collection or recovery action after a complaint is registered.
- AFCA financial hardship complaints for the hardship disputes AFCA says it can consider.
- AFCA default judgment and financial difficulty guidance for the point at which an enforced judgment or warrant and possession can prevent AFCA from intervening.
- Moneysmart bridging finance definition for the Australian consumer explanation of bridging finance.
Evidence note: Primary sources were checked 14 September 2026. Your facility documents remain the source for your own maturity date, rate, default margin, extension rights, payout calculation, security and enforcement clauses.
An expired bridge is a sequence of decisions, not one event. First identify whether the loan is still performing, already past maturity, under a sale contract, in a payout shortfall or already in enforcement. Then get the four numbers and dates that control the file: the maturity date, a dated payout figure, the daily accrual after that date and the next recovery deadline. Extension is product-specific: some products do not extend beyond a maximum term, some require full reassessment and some may consider a fresh interest budget or variation. If the National Credit Code applies, section 88 generally requires a compliant default notice and at least 30 days to remedy before enforcement proceedings, subject to the statutory exceptions. A qualifying hardship notice under sections 72 and 89A can add further requirements before enforcement, but it is not an automatic extension or indefinite freeze. If the Code does not apply, read the contract and get legal advice on the enforcement timetable. While you still control the sale, compare the certain cost of waiting with the realistic extra sale price you are waiting for, and test sale, refinance and extension in parallel rather than one after another.
Key takeaway: do not wait for the lender to define the problem. Get the payout, daily accrual, extension position and recovery deadline in writing, then set your own decision date before control of the sale changes.Frequently Asked Questions
It does not disappear or convert to a normal home loan. The amount due and the lender's next rights come from the contract. On a Code regulated facility, section 88 generally requires a default notice with at least 30 days to remedy before enforcement can begin. A business purpose facility runs on its contract, unless the declaration is ineffective under section 13. The bridging, caveat or second mortgage guide helps identify which structure you hold.
It depends which of six positions you are in. If the term has not quite passed, ring the funder while the facility is still performing. If it has passed and you have heard nothing, ask for a dated payout figure and get the sale campaign into evidence. If a letter has arrived, work out whether it is a statutory default notice or a contractual demand, because they run to different clocks. The triage table sets out all six; if the refinance is declined, bridging loan declined is the next read.
Only where the National Credit Code applies to the loan. Section 88 of the Code requires a default notice allowing at least 30 days from the date of the notice to remedy the default, and enforcement proceedings cannot begin until that period has expired. A bridge written on a declared business purpose sits outside that requirement, unless the declaration is ineffective under section 13(3). Our glossary entry on default covers the term itself.
Prepaid interest buys a defined period, not an outcome, so once that budget is exhausted the facility begins accruing against you. One major bank's published terms say that where the property has not sold inside the agreed term the lender may apply a higher default rate or remove a discretionary margin. The rate varies by lender and contract and we publish no figure for it. How the balance compounds while this happens is in what capitalised interest costs on a bridge.
Because a payout figure is a forward quote rather than a historical balance. On an expired bridge it adds interest accruing to the discharge date, capitalised interest already inside the balance, any minimum interest period the contract has not yet used, two discharge registrations on a two property facility, and any default margin running since maturity. Ask for the figure to a nominated date and ask what accrues daily after it. Our payout figure entry sets out the difference.
Sometimes, but there is no single Australian extension rule. Published product positions range from no extension above a maximum term, to full reassessment with new documents and costs, to a case-by-case fresh interest budget or variation. Ask what your actual product permits, what evidence is required, what the new period costs and what happens if the extension also expires. Planning the exit before you sign is the preventive read.
AFCA says a financial firm must suspend collection or recovery action once a complaint has been registered, while interest and fees will usually continue to accrue. AFCA also says it cannot intervene where a default judgment or warrant of possession has already been enforced and the firm has taken possession of the security property, because an order already enforced cannot be suspended. Timing and jurisdiction both matter. Our mortgagee in possession guide covers the enforcement stage.
There is no single non-bank rule. In documents reviewed for this guide, one lender expressly states that repayments become required on peak or actual debt at expiry, while other consumer-facing documents do not publish an equivalent term-end rule. Ask what your own lender's product documentation and contract say about repayments, interest, extension and recovery from the day after maturity. The exit plans private lenders want is the closest published guide to their thinking.
You do, because a sale that does not clear the debt does not end the debt. Section 88(3) of the National Credit Code requires a regulated default notice to say exactly that: repossession and sale of mortgaged property may not extinguish the borrower's liability. How sale proceeds are applied and who bears a shortfall after a mortgagee sale is answered in our mortgagee in possession guide, and the payout shortfall guide covers the refinance side.
Treat the next 30 days as a finance deadline as well as a sale deadline. Ask the lender now for its extension or reassessment requirements, a payout figure to a future date and the daily accrual after that date. Put the sale campaign into evidence and test a refinance in parallel rather than waiting for the extension answer first. Set your own decision date before maturity for changing price, campaign or exit. Whether to hold for a better price or cut it is worked through in holding a property to sell later.
Yes, in principle, if an incoming lender will approve and settle before the outgoing lender ends any agreed breathing room. Expiry does not make refinance impossible, but it makes valuation, payout timing, serviceability, exit evidence and any first mortgagee consent more urgent. Do not treat a refinance application as an extension unless the outgoing lender has agreed that in writing. Borrowing against the listed property to clear the expired facility is covered in bridging loan until your property sells.
There is no standard Australian extension price. Depending on the product and variation, the total can include a fresh interest budget, an extension or establishment fee, a new valuation, legal or documentation costs and any higher rate or default margin that applies. Ask for the total dollar cost to the new maturity date rather than comparing only the interest rate. The fee lines an extension can carry are decoded in bridging loan rates, fees and the term sheet.
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