When you buy a new home before the sale of your current home closes, there may be a temporary gap between when purchase funds are needed and when sale proceeds become available. Bridge financing is one possible tool, but it is not automatic and it is not appropriate for every situation.
Key points
- Bridge financing is short-term financing for a timing gap.
- Approval, limits, costs, and documentation depend on the lender.
- A firm sale is commonly important, but lender requirements vary.
- Deposit timing is a separate issue from closing-day funds.
- Your mortgage professional and lawyer should review the plan early.
This article provides general information only. Financing terms and eligibility can change, so rely on written advice from your licensed mortgage professional, lender, and lawyer.
Why a closing gap happens
Suppose your purchase closes on Monday and your current home sale closes on Friday. Your equity is tied up in the existing property until its sale is completed, but purchase funds are required earlier. A lender may be willing to provide short-term financing secured and repaid as arranged, subject to its requirements.
If you are still deciding on the broader sequence, read how to sell and buy a home at the same time in the GTA.
Bridge financing is not the same as a deposit
A purchase deposit is usually due soon after offer acceptance. Bridge financing is generally associated with the period around closing. Do not assume a bridge facility will fund an earlier deposit. Confirm the deposit source and transfer timing before you make an offer.
| Item | Typical timing question | Who to ask |
|---|---|---|
| Offer deposit | When is it due and how will it be delivered? | Realtor, brokerage, bank |
| Down payment | Which funds must be available for closing? | Mortgage professional, lender, lawyer |
| Bridge facility | Is it approved, for how much, and on what terms? | Mortgage professional, lender |
| Closing funds | When and how must funds reach the lawyer? | Real estate lawyer |
Questions to ask about a bridge facility
- Must my current property have a firm sale agreement?
- What documents and conditions are required?
- What is the maximum amount and permitted term?
- What interest rate, administration fee, legal fee, or other cost applies?
- How and when will the funds be advanced and repaid?
- What happens if my sale closing is delayed?
- Does the plan affect my mortgage approval or required cash?
Plan closing dates as a system
Closing on the same day may appear efficient, but funds and documents still have to move through the legal process. A delay on the sale can affect the purchase. Separating the dates can create breathing room, but it may add financing, accommodation, or carrying costs. Ask your lawyer and mortgage professional to explain the practical tradeoffs for your transactions.
Important: Do not waive financing or make a firm commitment based on an informal assumption that bridge financing will be available. Obtain the required approval and understand its conditions.
Build a fallback plan
A thoughtful plan considers what happens if financing changes, the sale closing is delayed, moving schedules fail, or possession timing becomes complicated. Possible responses depend on the agreements and professional advice; they may involve extra funds, accommodation, storage, revised logistics, or legal remedies.
Documents and professionals
Your mortgage professional may request the signed purchase and sale agreements, mortgage information, and proof of equity or other documents. Your lawyer manages legal closing requirements and the movement of funds. Keep both informed about amendments, changed dates, and any issue affecting the sale or purchase.
Use regulated, current guidance
- FSRA: working with a mortgage professional
- FSRA: mortgage application process
- RECO Information Guide
General information only, not mortgage, legal, tax, or financial advice. Products, lender requirements, and transaction circumstances vary.
Put dates, funds, and property strategy on one timeline
I can coordinate the real estate side of your move with the financing and legal milestones confirmed by your professionals.
Related move-up resources
- GTA move-up home buyer guide
- How much equity do you need?
- Request a home evaluation
- Ontario land transfer tax guidance
Content and links reviewed November 8, 2026.
