Bridge Loans in Michigan: Buy Your Next Home Before Selling Your Current One
Found Your Dream Home but Haven't Sold Your Current House?
Is Bridge Loan Right For You?
Use your existing home's equity to help purchase your next home—without waiting for your current home to sell.
Buying a new home while selling your existing property can feel like a balancing act.
What if you find the perfect home before your current house sells? What if you need the equity from your existing property for the down payment? What if a home-sale contingency makes your offer less attractive?
At Iris Mortgage, we help Michigan homeowners explore bridge loan financing that allows them to access equity from their current home to help purchase their next primary residence.
A bridge loan may give you the financial flexibility to buy first, sell later, and transition between homes with less pressure.
Don't let the timing of selling your current home stop you from buying your next one.
Two Bridge Loan Options at Iris Mortgage
We have you covered from Ambassador to Zilwaukee
The Ambassador: Our Standard Bridge Loan — Up to $250,000
Access Your Home Equity for Your Next Down Payment
Our Standard Bridge Loan is designed for homeowners who need up to $250,000 from their existing home's equity to help purchase their next primary residence.
Program Highlights:
Loan amounts up to $250,000
Up to 85% combined loan-to-value (CLTV)
Minimum 680 credit score
Six-month loan term
Interest-only monthly payments
$1,500 origination fee
Potential additional six-month extension, subject to a $2,000 renewal fee
Eligible closing costs may be paid from bridge loan proceeds
Example:
Your current home is worth $400,000, and you owe $150,000 on your mortgage.
At 85% CLTV, your maximum combined mortgage debt would be $340,000.
After subtracting your existing $150,000 mortgage, you could potentially access $190,000 in bridge financing, before applicable costs and underwriting adjustments.
Use those funds to help purchase your next home without waiting for your current property to sell.
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The Mighty Mac: Expanded Bridge Loan — $250,001 to $500,000
Access Your Home Equity for Your Next Down Payment
Our Expanded Bridge Loan is designed for homeowners who need a larger amount of equity to help purchase their next primary residence.
This option may be particularly useful for buyers purchasing higher-priced homes or making a substantial down payment.
Program Highlights:
Loan amounts from $250,001 to $500,000
Up to 75% combined loan-to-value (CLTV)
Minimum 680 credit score
Six-month loan term
Interest-only monthly payments
$2,500 origination fee
Potential additional six-month extension, subject to a $2,000 renewal fee
Eligible closing costs may be paid from bridge loan proceeds
Full third-party appraisal required for bridge loans of $400,000 or more
Example:
Your current home is worth $1,000,000, and you owe $250,000 on your mortgage.
At 75% CLTV, your maximum combined mortgage debt would be $750,000.
After subtracting your existing mortgage balance of $250,000, you could potentially access $500,000 in bridge financing, before applicable costs and underwriting adjustments.
That equity could help you purchase your next home while you prepare your existing property for sale.
Requirements for Both Bridge Loan Options
Both programs generally require:
Minimum 680 credit score
Qualifying income and available home equity
Maximum 45% debt-to-income ratio, potentially increasing to 50% when CLTV is below 70%
An eligible existing primary residence, such as a single-family home, condo, or townhome
Qualification considering housing payments on the existing residence, bridge loan, and new residence
An eligible new primary residence mortgage through the participating lending relationship
Both programs require repayment of the outstanding principal at maturity or upon an earlier payoff, typically from the sale of the existing home.
Which Bridge Loan Is Right for You?
Iris Mortgage can review your estimated home value, existing mortgage balance, and next-home purchase budget to help determine how much equity you may qualify to access.
Loan terms, fees, and program eligibility are subject to change and underwriting approval. Interest-only payments do not reduce the principal balance. Extensions are not guaranteed and must be arranged before loan maturity. Illustrations are hypothetical and do not represent loan approvals.
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Frequently Asked Questions About Bridge Loans in Michigan
Everything You Need to Know About Buying a Home Before Selling Your Current One
Can you buy a new home without selling your current house first?
Yes—and a bridge loan could help make it possible.
At Iris Mortgage, we help Michigan homeowners explore short-term financing solutions that allow them to access the equity in their current homes to help purchase their next primary residence.
Whether you're upgrading to a larger home, downsizing, relocating, or simply trying to avoid a home-sale contingency, understanding your bridge loan options can help you make a more informed decision.
Below are answers to common questions about bridge loan requirements, financing limits, costs, and the homebuying process.
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Bridge Loan Basics
1. What is a bridge loan in real estate?
A bridge loan is a short-term loan that helps homeowners access the equity in their current property before selling it.
For example, if you have $250,000 in equity in your existing home but need money for the down payment on your next house, a bridge loan may allow you to borrow against a portion of that equity.
When your existing property sells, you can use the sale proceeds to repay the bridge loan.
Bridge loans are commonly used by homeowners who want to buy their next home before selling their current residence.
2. How do bridge loans work in Michigan?
A bridge loan works by using your existing primary residence as collateral for short-term financing.
The process generally involves:
Reviewing your current home's estimated value and existing mortgage balance.
Determining how much equity may be available.
Qualifying for the bridge loan and your new mortgage.
Closing the bridge loan and accessing eligible proceeds.
Purchasing your next primary residence.
Selling your previous home and repaying the bridge loan.
The specific financing structure depends on the lender, loan amount, property type, and your qualifications.
3. Can I buy a house before selling my current home?
Yes. If you qualify for the necessary financing, you may be able to purchase your next home before selling your existing property.
A bridge loan may provide funds for your new down payment while allowing additional time to sell your current home.
You'll generally need sufficient equity and qualifying income to support the required payments during the period when you own both properties.
4. Can a bridge loan help me avoid a home-sale contingency?
Yes, potentially.
A home-sale contingency makes your new home purchase dependent on selling your existing property.
If you qualify for a bridge loan and your new mortgage without requiring proceeds from a completed home sale, you may be able to make an offer without that contingency.
This can make your offer more appealing to sellers, especially in competitive real estate markets.
A bridge loan does not guarantee that a seller will accept your offer.
5. Is a bridge loan the same as a second mortgage?
Not exactly.
A bridge loan may be structured as a second mortgage behind your existing home loan, but its defining feature is its short-term purpose.
Bridge loans are often repaid when the existing property sells.
A traditional second mortgage may have a longer repayment term and a different payment structure.
Michigan Bridge Loan Requirements
6. What credit score do I need for a bridge loan?
Certain bridge loan programs available through Iris Mortgage have a minimum credit score requirement of 680.
Additional requirements apply, including income verification, debt-to-income ratio, property eligibility, and available equity.
Meeting the minimum credit score does not guarantee approval.
7. How much can I borrow with a Michigan bridge loan?
Depending on your qualifications, bridge loan financing may be available up to $500,000.
The program offers two loan-size tiers:
Bridge Loans Up to $250,000
Maximum combined loan-to-value ratio of 85%.
Six-month loan term.
Interest-only monthly payments.
Bridge Loans From $250,001 to $500,000
Maximum combined loan-to-value ratio of 75%.
Six-month loan term.
Interest-only monthly payments.
The actual amount available depends on your home's value, existing mortgage balance, income, credit, and lender approval.
8. How much equity do I need to qualify for a bridge loan?
The equity required depends on your home's value, outstanding mortgage debt, requested bridge loan amount, and maximum combined loan-to-value ratio.
For example, suppose your home is worth $500,000 and your current mortgage balance is $200,000.
At an 85% maximum CLTV:
$500,000 × 85% = $425,000
$425,000 − $200,000 = $225,000
You could potentially qualify for a bridge loan of up to $225,000, subject to underwriting and applicable costs.
Having sufficient equity is only one part of qualification. You must also meet the lender's credit, income, and other requirements.
9. Can I get a bridge loan if I still have a mortgage?
Yes.
Many borrowers use a bridge loan while they still owe money on their existing home.
The lender considers the outstanding mortgage balance when determining how much additional financing can be secured by the property.
You will generally remain responsible for payments on your existing mortgage during the bridge loan period.
10. What debt-to-income ratio is allowed for a bridge loan?
Certain available bridge loan programs permit debt-to-income ratios up to 45%.
In some qualifying scenarios where the combined loan-to-value ratio is below 70%, a debt-to-income ratio of up to 50% may be permitted.
The calculation generally includes required payments for your existing residence, bridge loan, new residence, and other qualifying debts.
11. Do I need to have my current home listed for sale?
Not necessarily.
However, the loan is intended for homeowners transitioning from their existing primary residence into a new primary home.
The lender may review your anticipated selling timeline and repayment strategy.
It's important to discuss your plans with Iris Mortgage before listing your home or making an offer on your next property.
12. Can I get a bridge loan on a condominium or townhome?
Yes.
Certain bridge loan programs allow eligible single-family homes, condominiums, and townhomes as the existing primary residence securing the loan.
Property eligibility and valuation requirements still apply.
Bridge Loan Costs and Payments
13. What does a bridge loan cost in Michigan?
Bridge loan costs typically include interest, origination fees, and other applicable closing expenses.
One available program has the following origination charges:
Loans up to $250,000: $1,500 origination fee.
Loans from $250,001 to $500,000: $2,500 origination fee.
Other costs may include title, valuation, settlement, and applicable lender charges.
The actual interest rate, annual percentage rate, and total loan costs will be disclosed for your individual transaction.
14. Do I make monthly payments on a bridge loan?
Yes.
The bridge loan program described here generally requires monthly interest-only payments during the six-month loan term.
Interest-only payments cover the interest due but do not reduce the principal balance.
The outstanding loan balance must be paid when the loan matures or is otherwise paid off.
15. How long do bridge loans last?
The bridge loan program currently described has a six-month term.
A six-month extension may be available for eligible borrowers, subject to approval and an additional fee.
Extensions are not automatic and must be arranged before the original loan maturity date.
16. What happens if my house doesn't sell before my bridge loan is due?
You remain responsible for repaying the bridge loan according to its terms.
If your house has not sold, you may need to explore an approved extension, alternative refinancing, or another source of repayment.
Because a bridge loan typically has a balloon payment at maturity, it's important to have a realistic plan for selling your existing home and a backup strategy if the sale takes longer than expected.
17. Can bridge loan closing costs be financed?
Certain bridge loan programs allow eligible closing costs to be included in the bridge loan proceeds.
Whether those costs can be financed depends on the maximum available loan amount, property equity, lender requirements, and transaction structure.
18. Do bridge loans require an appraisal?
A property valuation is generally required.
Some bridge loans may qualify for a streamlined valuation process.
Under one available program, bridge loan amounts of $400,000 or more require a full third-party appraisal.
The lender determines the appropriate valuation method for each transaction.
Bridge Loans vs. Other Mortgage Options
19. What is the difference between a bridge loan and a HELOC?
A bridge loan is generally a short-term financing solution designed to help homeowners purchase their next property before selling their current home.
A Home Equity Line of Credit, or HELOC, is typically a revolving credit line secured by the existing property.
Bridge loans are often structured around repayment from the sale of the current home, while HELOCs commonly have longer draw and repayment periods.
Some HELOC lenders also restrict access to funds when a home is listed for sale.
Iris Mortgage can help borrowers compare available home equity financing solutions.
20. Is a bridge loan better than selling my house first?
It depends on your financial situation and goals.
A bridge loan may make sense if you have substantial equity, can qualify for the required housing payments, and want to purchase before selling.
Selling first may be preferable if you want to eliminate your existing mortgage before taking on another, reduce borrowing costs, or avoid the risk of carrying multiple properties.
There is no single financing strategy that works best for every homeowner.
21. Can I use a bridge loan for the down payment on my next home?
Yes.
One of the primary uses of bridge financing is to access eligible equity from your existing home to help fund the down payment on your new primary residence.
Your new mortgage lender must also confirm that the funds and bridge loan payments meet the requirements of the new financing program.
22. Can a bridge loan help me purchase a home without selling investments?
Potentially.
Instead of liquidating investments or using substantial cash savings for a down payment, an eligible homeowner may use available home equity through a bridge loan.
However, bridge financing carries borrowing costs and repayment risk, so it is important to compare the total financial impact of each option.
Getting a Bridge Loan Through Iris Mortgage
23. How do I apply for a bridge loan in Michigan?
Start by contacting Iris Mortgage or completing a mortgage application.
We can review:
Your current home's estimated market value.
Your outstanding mortgage balance.
Your desired bridge loan amount.
Your new home's estimated purchase price.
Your income, credit, and existing obligations.
Your anticipated timeline for selling your current residence.
From there, we can help determine which available financing options fit your circumstances.
24. Does Iris Mortgage offer bridge loans throughout Michigan?
Iris Mortgage helps eligible Michigan homeowners explore bridge financing for qualifying transactions, subject to property location, lending-partner availability, licensing, and underwriting requirements.
25. Can a Michigan Realtor help me arrange a bridge loan?
Your Realtor can coordinate with Iris Mortgage while helping you plan the purchase of your next home and sale of your existing residence.
For buyers who need their existing equity to complete a new purchase, reviewing bridge financing before writing an offer can help establish a more realistic financing strategy.
Ready to Buy Before You Sell?
Let Your Home Equity Help You Make Your Next Move.
You may not have to wait for your current home to sell before purchasing your next one.
At Iris Mortgage, we'll help you understand your available equity, evaluate your mortgage options, and determine whether bridge financing makes sense.
Iris Mortgage LLC
All financing is subject to credit approval, property eligibility, lender underwriting, and program availability. Bridge loans are secured by real estate and generally require repayment of principal at maturity. Interest-only payments do not reduce principal. Fees, rates, and program requirements may change. Failure to repay a mortgage secured by your home could result in foreclosure. This content is informational and is not a commitment to lend or an offer of specific loan terms. Include required NMLS and Equal Housing Lender disclosures before publishing