Bridging Loan Until Your Property Sells: Borrowing Before the Sale
Property Lending Hub
Before the sale · Sale evidence · Settlement
You have listed a property, you need money before it sells, and your bank wants income you cannot show it yet. There is a lane that prices the sale instead of the income, with the loan repaid out of the proceeds. What you can prove about the sale, and what is left after settlement, is what sets the offer.
Quick Answer
Yes, you can borrow against a property you have already listed, and the sale repays the loan. Lenders in this lane price your equity and your sale evidence rather than your income, and they lend against their valuation, not your asking price.
The loan is usually a first or second mortgage arranged through private lending or second mortgage loans, with interest added to the balance and cleared from the sale proceeds.
Can you borrow against a property you are selling before it sells?
Yes. Licensed non-bank lenders write it as regulated consumer credit, and private funders write it as business purpose credit, and both treat the sale as the way the loan is repaid. A bank will generally not, because a bank is underwriting repayments from your income and this loan is built to have no repayments until the sale settles.
That makes it an equity loan with no servicing. Nothing leaves your account each month: the interest is added to the balance or deducted up front, and the whole facility is cleared from the sale proceeds. Where nothing will be owing once the sale settles, which lenders call no end debt, some published products drop the income test altogether. The published product terms, each with its source and read date, are in the table on what sets the borrowing ceiling.
Also called: an open bridging loan (listed, not yet sold), a closed bridging loan (sold, waiting for settlement), a sale funding loan (the term one private lender uses), or equity release before sale. Most people arrive asking for a short term loan against property, which is the same thing described from the outside.
There is a catch the product pages do not spell out. The non-bank bridging products read for this guide list purchase or construction as the loan purpose, because they are built for people buying before they sell. At least one private lender publishes a product built for the seller's case, which it calls a sale funding loan. If you are only selling and need money out, the loan usually comes from the private lane: a first mortgage where the property is unencumbered, or a registered second mortgage behind your bank.
| Structure | Security position | How it is usually assessed | Best fit |
|---|---|---|---|
| Buy before you sell bridging loan | Usually a first mortgage over the existing and new property | Peak debt, end debt, income and the expected sale | You are buying another property before the current one sells |
| Short term first mortgage with a sale exit | First ranking mortgage over the property being sold | Valuation, equity, purpose and a documented sale | The property is unencumbered, or its existing first mortgage is being refinanced |
| Short term second mortgage with a sale exit | Second ranking mortgage behind your existing lender | Combined loan to value ratio, first mortgage documents, title, purpose and sale | You want to keep the first mortgage and release more equity before the sale |
Availability, regulation, servicing rules and accepted purposes vary by lender and borrower. General information only.
The word bridging usually means something narrower. The regulator describes bridging finance as short term finance for the gap between buying a new property and selling the existing one (ASIC Moneysmart glossary, bridging finance, published 1 October 2019, read 15 September 2026). That definition assumes a purchase. This guide covers the case it leaves out: you are selling, you are not buying, and you need money before the proceeds arrive. If you are buying as well, the buying before selling guide is the right page.
If you are still choosing between a bridging loan, a caveat loan and a second mortgage, the three way comparison of bridging, caveat and second mortgage finance settles the instrument. The wider lane, including who still writes bridging finance, is in the bridging finance guide, and the rest of this lane sits under the Property Lending Hub.
Do you need a loan at all, or can the sale release money sooner?
Sometimes you do not, and it is worth checking before you pay for one. Three things can bring money forward or shrink the amount you need: an early release of the buyer's deposit, the commission and marketing terms you agree with the agent, and the settlement date you accept.
Can the buyer's deposit be released before settlement in Victoria?
In Victoria it can, under section 27 of the Sale of Land Act 1962 (Vic), but only on the buyer's terms. The vendor gives the purchaser a section 27 statement, the purchaser has 28 days to say whether they are satisfied with it, and only then can the deposit be released early. Victoria is one of the few places with a statutory procedure for this. Some purchasers' conveyancers object to early release as a standing policy, so treat it as possible rather than likely, and ask your own conveyancer what your contract allows in other states.
Consumer Affairs Victoria adds three conditions: the contract must be unconditional, the buyer cannot release the deposit until at least 28 days after the contract was signed, and you must satisfy the buyer that there are no debts secured against the property or that they total no more than 80 per cent of the sale price (Consumer Affairs Victoria, "Property deposits for sellers", read 15 September 2026). Any loan you add to the title counts in that total, so borrowing first can close this option off. Early release is also smaller than it looks. Consumer Affairs Victoria notes that at settlement the agent deducts its commission from the deposit and pays you the balance (Consumer Affairs Victoria, "Selling property with or without an agent", read 15 September 2026).
Outside Victoria there is no equivalent statutory release. In New South Wales and Queensland the deposit is normally held in the agent's or solicitor's trust account until completion and is released early only where the contract says so or both parties agree in writing, which buyers rarely do, so treat early release as a Victorian option and ask your conveyancer what your own contract allows before you count on it.
What should you agree with the agent before you borrow?
The marketing budget and when it is paid. Consumer Affairs Victoria states that agreed marketing costs are payable even if the property does not sell, unless you negotiate a no sale, no fee arrangement, and that commission and outgoings are negotiable. Every dollar of campaign cost you do not pay up front is a dollar you do not need to borrow, and on a capitalised loan it is also interest you never pay.
Does a shorter settlement period help?
Yes, on the cost side. A contract that settles sooner shortens the loan, and on a capitalised facility every month removed is a month of interest you never pay. Weigh that against a buyer pool that may want longer. If none of these closes the gap, a loan is the right tool, and the rest of this guide is how to get the right one.
What does a lender want to see about the sale?
A signed exclusive agency agreement, and the gap between a signed one and an unsigned one is the hardest line on this loan. Everything else on the file can be in order and an unsigned agreement will still change the offer, because it is the one document that turns an intention to sell into an exit a lender can price.
Why it carries that weight is a matter of law rather than lender preference. In Victoria an estate agent may not seek payment for work done unless the agent holds a written engagement signed by the person, told them before signature that commission was negotiable, and gave them a copy, with a penalty of 100 penalty units attached (Estate Agents Act 1980 (Vic) s 49A, "Offence not to give certain information about commission", read 15 September 2026). Until it is signed, nothing binds either side to a sale campaign.
Once it is signed, the position changes sharply. Consumer Affairs Victoria states that a sales authority is a legally binding contract, that an exclusive agency can claim commission even if you sell without its help, and that there is no cooling off period with a sales authority (Consumer Affairs Victoria, read 15 September 2026). It also states that where no period is written in, an exclusive authority runs for 60 days after signing for a private sale, or 30 days after the auction date. A 12 month loan can therefore outlast the agency agreement it relies on, so expect the lender to ask for the authority period and for a renewal if the campaign runs long.
Can you cancel a signed agency agreement?
It depends on the state, and the difference matters to a lender reading your file. The three positions verified for this guide all differ.
| State | Cooling off on the agency agreement | What it means for a lender | Source |
|---|---|---|---|
| Victoria | None. The authority cannot be cancelled during its period unless the agent agrees. | A signed authority is a committed exit from the day it is signed. | Consumer Affairs Victoria, read 15 September 2026 |
| New South Wales | 1 day, ending at 5pm on the next business day or Saturday after signing. | A lender may wait for the cooling off to end before treating the sale as committed. | NSW Fair Trading, Agency agreements fact sheet FTR32, read 15 September 2026 |
| Queensland | None stated. A sole or exclusive appointment runs for at most 90 days. Where the agreed term is over 60 days, either party can end it on 30 days' written notice, but it must stay in effect for at least 60 days. | A 12 month loan outlasts the appointment, so expect the lender to ask for reappointment evidence as the campaign runs. | Queensland Government, Appointing a real estate sales agent, updated 19 July 2024, read 15 September 2026 |
| South Australia, Western Australia, Tasmania, the ACT and the Northern Territory | Not verified for this guide. | Ask your agent and your state consumer affairs office before you rely on it. | Switchboard Finance, September 2026 |
Which sale evidence moves the offer?
Lenders read sale evidence as a ladder, not as present or absent, and each rung buys something different in the offer.
| Evidence held | What the lender can verify | Typical effect on the offer | Source |
|---|---|---|---|
| Verbal intention to list | Nothing beyond what you have said. | Treated as no exit evidence. The lender prices a refinance exit instead, or declines. | Practitioner, Switchboard Finance, September 2026 |
| Unsigned agency agreement | An agent has been chosen and a price discussed. Nothing binds either side. | Not yet a committed exit. Expect a shorter term, a lower limit, or a condition that the agreement is signed before funding. | Estate Agents Act 1980 (Vic) s 49A, read 15 September 2026 |
| Signed exclusive agency agreement | A binding engagement, the agreed commission and the agent's estimated selling price. | The rung most offers are built on. This is an open bridging position: listed, no buyer yet. | Consumer Affairs Victoria, read 15 September 2026 |
| Live listing with a price guide | The property is publicly on market and what buyers are being asked to pay. | Supports the term and campaign timeline. The guide is not accepted as value. | Practitioner, Switchboard Finance, September 2026 |
| Exchanged but conditional contract | A buyer and a price, still subject to cooling off, finance or building conditions. | Better than a listing, but the lender knows the sale can still fall away. | Practitioner, Switchboard Finance, September 2026 |
| Unconditional contract of sale | A committed buyer, a price and a settlement date. | The strongest rung. Lenders treat it as a closed bridging position, and some published products allow a higher ceiling on it. | ORDE Financial Broker Product Guide, July 2026, read 15 September 2026 |
Published figures are the lender's own, as at the date shown, and change without notice. Rows marked Practitioner are what this desk has seen on its own files, not a quote, not an offer, and not a rate or limit you will be given.
Is the agent's estimated selling price the same as the lender's valuation?
No. Consumer Affairs Victoria states that the agent's estimated selling price is not a valuation, must be based on three comparable properties, and can be a single price or a range of up to 10 per cent (Consumer Affairs Victoria, read 15 September 2026). The lender's valuation is a formal assessment built from comparable sales that have already settled. On a rising campaign the two can sit close together. On a stale one they can be far apart, and the valuation sets the limit every time.
Time is the third number. How long comparable homes in your suburb are taking to go under contract feeds straight into the term, because the term is a bet on your settlement date.
What did this look like on a real file?
On a file this desk worked in 2026, two adjoining houses were each listed at $1.3 million and neither agency agreement had been signed. The funder valued them at $950,000 and $940,000, about 27 and 28 per cent below the asking prices. It applied its 75 per cent ceiling to the $1.89 million combined valuation, not to the $2.6 million of listings. The approval came back conditional, with a first draw below the approved limit and the balance held back until the conditions were met. The unsigned agreements did not stop the approval. They shaped its conditions.
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.
This is where a broker changes the result. The order in which the agency agreement is signed, the clearance certificate is applied for and the application goes in decides the first offer you see. How any short term lender tests an exit more generally is covered in the private lender exit plan.
Does the money going to business debts make this a business purpose loan?
Yes, where the money clears the debts of a trading entity, because purpose follows the use of the funds, not the security on the title. Money going to a business's creditors, its tax debt or a commercial payout is business purpose credit. Money going to your household costs or a family member's build is consumer credit under the Code, whatever secures it. Money going to an investment property needs a closer look. Where the deadline is a court order or a property settlement rather than a creditor, the purpose test lands differently again, and that case is worked through in paying out a former partner with a bridge.
The Code applies where the debtor is a natural person or strata corporation, the credit is wholly or predominantly for personal, domestic or household purposes or to purchase, renovate or improve residential property for investment purposes, a charge is made for the credit, and the provider is in the business of providing credit (National Credit Code s 5(1), "Provision of credit to which this Code applies", Compilation No. 52, compilation date 1 July 2026, read 15 September 2026). Where the money splits between uses, predominant purpose means the purpose for which more than half the credit is intended to be used, under s 5(4) of the same section.
A business purpose declaration is not a switch you flick. It creates a presumption that the credit is not for a Code purpose, but it is ineffective where the provider knew or had reason to believe, or would have had reason to believe after reasonable inquiries, that the credit was really for a Code purpose. A declaration not substantially in the prescribed form is ineffective as well (National Credit Code s 13, "Presumptions relating to application of Code", Compilation No. 52, read 15 September 2026).
That has been tested. In an ASIC action against an unlicensed lender and its introducer, the Federal Court found they could not rely on a signed business purpose declaration alone and had to make reasonable inquiries into what the credit was for (ASIC media release 25-060MR, 16 April 2025, read 15 September 2026). Combined penalties of $515,000 followed (ASIC media release 25-301MR, 12 December 2025, read 15 September 2026). A lender asking what the money is for, and writing down your answer, is protecting itself rather than doubting you. Private lenders call a regulated loan coded and a business purpose loan non-coded, and some publish different fees and interest terms for each.
Where does the residential investment property limb apply?
The limb reaches credit used to purchase, renovate or improve residential investment property. Borrowing against an investment property you are selling to pay your trading company's creditors is business purpose. Borrowing against the same property to renovate another investment property falls inside the limb. Interest, council rates and other holding costs are not named in the limb, so whether that money is a Code purpose turns on the facts, and a lender will treat it cautiously. Get legal advice before you sign a declaration on that basis.
| What the money is used for | Likely characterisation | Which provision applies | What the lender must do before relying on a declaration |
|---|---|---|---|
| Debts of a trading entity | Business purpose | National Credit Code s 13, declaration | Make reasonable inquiries into the actual use, and hold a declaration substantially in the prescribed form. |
| A tax debt of the business | Business purpose | National Credit Code s 13, declaration | Confirm the debt sits with the entity rather than with you personally, then inquire and document. |
| A payout to a former business partner | Business purpose | National Credit Code s 13, declaration | Inquire into the underlying deal, since a personal settlement dressed as a buyout is a Code purpose. |
| Household costs or a family member's build | Consumer credit | National Credit Code s 5(1), personal, domestic or household purpose | Not rely on a declaration. A declaration over a Code purpose is ineffective under s 13. |
| Renovating another residential investment property | Consumer credit | National Credit Code s 5(1), residential investment property limb | Not rely on a declaration. The limb names renovation expressly. |
| Holding costs on a residential investment property | Fact specific | National Credit Code s 5(1) and s 5(4) | Test the predominant purpose on the facts and document it. Expect to be asked for more than a declaration. |
Statutory positions as at National Credit Code Compilation No. 52, compilation date 1 July 2026, read 15 September 2026. Characterisation is fact specific and is decided on the actual use of the funds, not on the label in the application. General information only, not legal advice.
The general operation of the Code on second mortgage lending is in the second mortgage guide, and the purposes lenders accept as business purposes are listed in the equity release refinance guide. Where the facility is business purpose and private, the private bridging loans for business guide covers security positions and exit files in more depth. What changes when a business purpose second mortgage ends is covered in getting out of a business purpose second mortgage. If your use of the funds is mixed, speak to a solicitor before you sign anything.
Why is the loan measured against a valuation and not your listing price?
Because a listing price is a marketing position and a valuation is an assessment, and a lender can only lend against the second one. The ceiling is a percentage of the valuation, and the valuation is often well below the price on the board, which is the most common surprise on this loan.
A valuer works backwards from comparable sales that have already settled. Your agent works forwards from what a motivated buyer might pay in a campaign that has not happened yet. Both can be reasonable and still be far apart, particularly on an unusual property, on adjoining titles, or where comparable sales are thin.
What do lenders publish about the ceiling and the income test?
| Product type | Published term | Stated loan purpose | Source |
|---|---|---|---|
| Non-bank bridging product | 80 per cent where the existing property's sale is contracted. Maximum 75 per cent on the existing property where the sale is not yet contracted. | Purchase | ORDE Financial Broker Product Guide, July 2026, read 15 September 2026 |
| Non-bank bridging product, sale terms | No income documents where there is no end debt. 12 month term for an uncontracted sale, 6 to 12 months for a contracted sale. | Purchase | ORDE Financial bridging page, read 15 September 2026 |
| Non-bank bridging product, standard | Maximum 80 per cent. Interest budget period up to 2 years, with standard serviceability on any residual debt. | Purchase or construction | La Trobe Financial bridging loan page, read 15 September 2026 |
| Private bridging product | Income reliance not required where no end debt remains. Interest capitalised. Terms up to 24 months. | Buying before selling | Assetline Capital bridging finance page, read 15 September 2026 |
| Private short term loan | Typically 65 per cent or lower, with 70 per cent considered on some occasions. Terms typically 1 to 36 months. | Any purpose, personal or business | Funding.com.au bridging loans page, read 15 September 2026 |
Each lender's own published terms as at the read date, not a comparison and not a recommendation. They change without notice. Not a quote, not an offer, and not a limit you will be given. General information only, not financial advice.
What sets the ceiling on your file?
| Basis | Non-bank lane | Private lane | Source |
|---|---|---|---|
| Formal valuation | The ceiling. A full valuation is ordered and the percentage is applied to it. | The ceiling, often ordered from a shorter panel with a faster turnaround. | La Trobe Financial and Funding.com.au bridging loans page, read 15 September 2026 |
| Agent's estimated selling price or listing price | Not used to set the limit. Read as context only. | Not used to set the limit, though it informs the view on the campaign. | Consumer Affairs Victoria, read 15 September 2026 |
| Combined valuation across two titles | Available where both properties are taken as security. | Common, and often the reason the structure works at all. | Practitioner, Switchboard Finance, September 2026 |
| Initial draw against the limit | The approved limit and the day one draw can be separate numbers. | Initial draw below the limit, with the balance held back against the sale. | Practitioner, Switchboard Finance, September 2026 |
How much cash actually reaches you on day one?
Less than the approved limit. Four numbers are easy to confuse: the facility limit is the most the lender will lend against the security, the initial draw is what it advances at settlement, direct deductions are the interest, fees and existing debts paid before you see anything, and the net advance is the cash left. Net advance equals the initial draw, minus payouts to existing creditors, minus retained or prepaid interest, minus establishment, valuation and legal costs.
| Line | Amount | What it means |
|---|---|---|
| Approved facility limit | $300,000 | The most the lender will lend against the security. Not the day one cash. |
| Initial draw | $250,000 | What the lender releases when the new loan settles. |
| Existing caveat payout | minus $80,000 | Paid straight to the existing secured creditor so its interest can be removed. |
| Retained interest, 6 months at 11.00 per cent | minus $13,750 | Illustrative. Rates and interest methods vary by lender. |
| Establishment, legal and valuation costs | minus $7,500 | Illustrative. Costs vary by lender, security and transaction. |
| Net cash to you | $148,750 | What is left after the direct payout and costs. |
Illustrative arithmetic only, not a quote, not an offer and not a rate you will be given.
A lender can approve a facility and still not release all of it on day one. The limit is measured against the security and the draw is measured against the risk, so a file with an unsigned agency agreement can approve at the full percentage and release part of it, with the rest available once the campaign has moved. It is not a bait and switch. It is a hold back against the equity that repays the loan.
If the valuation lands short of what the plan needs, the options are set out in what to do about a valuation shortfall. If you can evidence income and want a limit set on servicing instead, you should be on the route in cash out refinance limits and evidence.
How does the new loan settle if there is already a mortgage, second mortgage or caveat?
It is mapped before a dollar moves. The title search shows every registered interest, each outgoing creditor states what it needs to be paid or to release its security, and the incoming lender's lawyers set the order in which things are paid, discharged, withdrawn, consented to or left in place.
Your existing bank can usually stay in place where the new loan sits behind it as a second mortgage and your mortgage documents allow that; consent and priority are covered in second mortgage consent and the deed of priority, and the choice between a second mortgage, a caveat and a first mortgage over a clear title belongs to the bridging, caveat or second mortgage guide. An existing caveat or private second can be paid out at settlement of the new loan where the amount and the release are agreed; a disputed caveat is a legal path first, covered in what to do when someone else's caveat blocks settlement. Using a lender other than the one that holds your mortgage is its own question, answered in bridging with a different lender to your mortgage.
What does it cost when you make no repayments until the sale?
On $500,000 held for 6 months, interest alone runs to about $21,000 to $21,600 at the lowest published non-bank bridging starting rates read for this guide, 8.29 and 8.49 per cent, before fees, and it all comes out of the sale proceeds. Starting rates are the floor, not a quote: private second mortgage pricing sits higher and is set per file, read 15 September 2026.
There are two shapes. With capitalised interest, interest is added to the balance each month, so a 6 month campaign costs meaningfully more than a 3 month one and a price cut that stretches the campaign costs more again. With prepaid interest, the interest for the expected term is deducted from the advance, so you receive less up front but know the payout figure from day one. Prepaid is cleaner if the timeline is firm and the equity is thin. Capitalised suits you if you need the most cash on day one and the campaign length is genuinely uncertain.
On top of interest sit establishment, legal and valuation costs, and on some private products a risk fee. Two published non-bank bridging products charge an application fee of 1.25 per cent, and one private funder charges a fixed risk fee of 0.75 per cent. Legal and valuation costs are charged at cost and rise with the number of titles. Work out the full payout figure at the expected settlement date, then subtract it from the valuation rather than the asking price, and see what is left.
Fees as published by the respective lenders: ORDE Financial Broker Product Guide, July 2026, La Trobe Financial bridging loan page and Assetline Capital bridging finance page, read 15 September 2026, subject to change without notice. Illustrative interest figures assume monthly capitalisation over 6 months and are not a quote.
From our broking, indicative
Private second mortgage pricing on a sale exit is quoted per file rather than published, and this guide does not state a desk rate band. What is consistent across the lane is the shape: limits measured against a valuation rather than the listing price, an initial draw below the limit, the balance held back against the sale, and every cost settled from the proceeds.
Indicative only, based on deals we have worked. Not a quote and not an offer. Actual terms depend on lender policy and your circumstances at the time of application. Not financial advice.
If the sale settles early, what happens to interest you have already prepaid or had retained depends on the term sheet. One private lender's published guide rebates unused retained interest on early repayment, while other facilities charge a minimum interest period, so ask which applies before you sign. What drives the private rate itself is covered in what drives the cost of a caveat loan.
Every line of a term sheet, including minimum interest periods and default rates, is decoded in the bridging loan rates, fees and term sheet guide. If your bank will write a cash out refinance and you can pass its assessment, that route costs far less, and the trade is set out in second mortgage versus bank cash out refinance. This lane earns its cost when the bank route is closed or too slow, not when it is merely inconvenient.
Does the lender set the term from how long your property takes to sell?
Yes. The lender sets the term from the sale it expects, not from your preference, and published products give an uncontracted sale a longer fixed term than a contracted one. In practice the lender picks a date a sensible distance past the settlement it expects, using the campaign plan, the evidence you hold and how long comparable homes in your suburb take to go under contract.
Ask for 3 months on a property that comparable sales say will take 6, and you will be offered a longer term or a smaller loan, not the term you asked for. Extensions usually exist, but they are priced and not automatic. The lender will want the campaign history, the current price position and the agent's view, and it will want that conversation weeks before the term ends, not in the last fortnight.
What happens if the term ends before the property sells is covered in the guide to a bridging loan that expires before the sale, and refinancing out is covered in exiting short term property finance into a term loan. How fast one of these can be arranged in the first place is answered in what sets the clock on a short term second mortgage.
Where does the money go once the property sells?
Your lenders are paid before you are. On the settlement date the purchase money clears the first mortgage, then this loan at its payout figure, then the agent's commission and the conveyancing costs, and what is left is yours. The payout figure is not the balance on your last statement: it is struck for the settlement date with interest to that day and any fees the contract allows, so ask for it in writing against the booked date, not the hoped for one.
The full sequence, who sets the order and why the number moves in the last week is covered in who is paid at settlement and in what order. How a payout figure is built and how long it stays valid is in private mortgage payout and discharge. Where the sale price will not cover what you owe, sold early or sold for less sets out what the lender does next, and where two properties secure the loan and only one sells, the funder decides what it releases from the first proceeds against the remaining security, a question clearing business debts before the sale works through for a business borrower.
What if the property is still unsold, or you want to wait for a better price?
Act before the term runs out, not at the end. About 60 days before maturity, rebuild the exit: current listing, campaign history, buyer enquiry, written offers, agent feedback, pricing strategy, an updated payout figure and the extension or refinance you would use if the sale does not settle in time. That 60 day checkpoint is a practical rule of thumb, not a lender rule.
| Option | When it may fit | The question to answer |
|---|---|---|
| Extend the loan | The campaign is active and the sale still looks credible. | What will the extension cost, and what new evidence will the lender want? |
| Cut the asking price | Buyer feedback says price is the obstacle. | Is the price cut smaller than the cost and risk of waiting? |
| Refinance the loan | Another lender or a longer structure now fits. | Can the refinance settle before maturity at a cost you can carry? |
| Change the sale strategy | The campaign has stalled but the property is still saleable. | Will a new agent, method or campaign really improve the exit? |
| Withdraw from sale | You no longer intend to sell. | What replacement exit repays the loan by maturity? |
Whether to cut the price or pay to wait is one sum: the extra interest, any extension fee and the holding costs against the price you expect to gain, worked at the valuation rather than the asking price. The arithmetic, and the lender's side of it, is set out in holding a property to sell later. If the term runs out first, bridging loan expired and the property not sold sets out what happens on the maturity date and what an extension costs.
Borrowing against a property you are selling turns on documents rather than income. A signed exclusive agency agreement makes the sale an exit a lender will price, the valuation, not your listing price, sets the ceiling, and whether the loan is consumer credit or business purpose follows the use of the funds. Everything is settled from the proceeds, so the net surplus after commission, both payouts and any withholding is the number that decides whether the plan works.
Key takeaway: sign the agency agreement and apply for the clearance certificate before you apply, and build the plan on the net surplus at the valuation, not on the asking price.Frequently asked questions
Often not, where nothing will be owing after the sale. Lenders call that no end debt, and some published bridging products, read 15 September 2026, state that income evidence is not required in that case. Where a residual loan will remain, expect a normal income assessment on that part. The lender still tests the security and the sale evidence either way, and the lane is explained in the guide to bridging finance without a bank.
Yes. Listed and uncontracted is the normal starting point, and lenders call it an open bridging loan. Expect a lower ceiling and a firmer term than on a contracted sale, because the lender has no buyer or settlement date yet. What happens if the sale is slower than planned is covered in the guide to a bridging loan that has expired.
You fund the difference before settlement, or settlement does not complete. Each lender releases its mortgage only when its payout is met, so a shortfall has to come from cash, another lender, or an arrangement agreed with the lender in advance. Raise it as soon as offers point below the payout figure. What the lender does when the sale clears less than the loan assumed is covered in sold early or sold for less.
Because the limit is measured against the security and the draw is measured against the risk. A lender will often approve a ceiling, release a first draw well under it, and hold the balance back until the sale is further along or a contract is exchanged. The hold back protects the equity that repays the loan and the capitalised interest that builds on it.
Often yes, but the caveat has to be dealt with before funding, not after. A caveat on the title tells the incoming lender that someone else claims an interest, so the lender will want it withdrawn, or the caveator's position documented, before releasing money. Paying out an existing caveat from the new loan is covered in clearing business debts before the sale, and removal in caveat loan exit, discharge and removal.
Yes. The new lender usually takes a registered second mortgage behind your existing bank, which stays in place until the sale. Check your current mortgage first, because some require the first lender's consent before a second mortgage is registered, and that step adds time. The two structures and what each costs are covered in bridging with a different lender to your mortgage.
It matters for the evidence, not the product. A private treaty sale can produce a contract at any point, and an unconditional contract is the strongest evidence a lender can hold. An auction gives a fixed date but no buyer until the day, so before it you hold a live listing rather than a contract. Lenders price the evidence you actually hold, which also drives how long approval takes.
It can keep money withheld for capital gains withholding. If you do not give the buyer a clearance certificate by settlement, the buyer must withhold up to 15 per cent of the price and pay it to the ATO, which refunds it in full only where there are no tax debts and no capital gains tax on the sale. Apply at least 28 days before settlement through the ATO clearance certificate page. Clearing a tax debt with a private loan is covered in the guide to private bridging for business.
You do not announce it, but it is not private either. A registered mortgage or a caveat appears on a title search, so the buyer's conveyancer will see it and require a discharge or withdrawal at settlement. Tell your own conveyancer at the start so payout figures are ordered in time. The settlement order is set out in who gets paid at a second mortgage settlement.
You need a replacement exit, and you need it before the term runs out rather than at the end. The loan was written against the sale, so withdrawing the listing removes the repayment the lender priced. In practice that means a refinance, a different sale, or an extension agreed in advance. How lenders assess a replacement exit is covered in the private lender exit plan.
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