Bridge Loan Calculator

What Is Bridge Loan Calculator?

The Bridge Loan Calculator helps buyers and homeowners quantify the short-term financing needed to “bridge” a timing gap between purchasing a new property and selling or refinancing an existing one. It translates rate, term, loan-to-value (LTV), points, fees, and repayment assumptions into concrete outputs: monthly interest-only payment, daily interest for short closings, balloon payoff at exit, and net cash available after costs. Because bridge loans are typically interest-only with a lump-sum payoff from sale proceeds or refinance, clarity on carrying cost and exit requirements is critical. The calculator surfaces those numbers with auditable steps so you can size the advance responsibly, avoid over-leverage, and build a realistic exit plan aligned with listing timelines, contingency dates, and lender covenants.

About the Bridge Loan Calculator

This calculator supports common bridge structures: single-collateral (new home only) and cross-collateralized (secured by the home you are selling and/or the home you are buying). Inputs include collateral value(s), existing liens, target LTV or combined LTV (CLTV), nominal annual interest rate, points, fixed fees, term in months, and optional daily accrual for partial months. Results show gross loan amount, points and fee totals, net advance to you at funding, monthly interest-only payment, pro-rated daily interest, balloon payoff, and basic leverage metrics (LTV/CLTV). For conservative planning, you can include estimated selling costs and see the sale-price break-even needed to clear the bridge at exit. Every line is tied to standard formulas so worksheets, quotes, and disclosures reconcile quickly.

How to Use this Bridge Loan Calculator

1) Enter property value(s) and any existing liens. 2) Choose a maximum LTV or CLTV policy and compute the eligible loan amount. 3) Provide the note rate, points, other fees, and the expected term (months) or specific day count to estimate carrying cost. 4) If modeling an exit sale, enter expected sale price and closing costs to preview payoff coverage. 5) Submit to view net advance, monthly interest-only payment, total expected interest, and balloon payoff. 6) Test scenarios—higher rate, different term, or lower sale price—to check sensitivity and build buffers before committing.

Examples Using the Bridge Loan Calculator

Example A (purchase bridge, interest-only): New home value $500,000; LTV 80% ⇒ gross loan $400,000. Points 2% = $8,000; rate 10% APR; term 6 months. Monthly interest-only ≈ $400,000×0.10/12 = $3,333.33; total interest ≈ $20,000. Net advance ≈ $392,000 before third-party fees; total carrying cost (points + interest) ≈ $28,000.

Example B (equity release from current home): Current value $350,000; first mortgage $180,000; policy 70% LTV on that collateral. Max bridge ≈ 0.70×$350,000 − $180,000 = $65,000 for down payment and closing funds.

Example C (short closing, daily interest): Principal $150,000 at 12% for 45 days ⇒ daily interest ≈ $150,000×0.12/365×45 ≈ $2,219; payoff = principal + accrued interest (assuming interest accrues and is paid at exit).

Core Formulas (rendered responsively)

Eligible advance against a single property.

Equity available when a first mortgage is present.

Leverage check against policy limits.

Percentage-of-loan origination cost.

Cash available to you at funding.

Nominal annual rate \(i\) converted to a monthly interest-only charge.

Use day count \(d\) for partial months or exact payoff dates.

Outstanding principal repaid from sale or refinance.

Minimum exit price to retire the bridge (ignores taxes).

Approximate all-in cost over \(m\) months if interest is paid monthly and principal is unchanged.

FAQs

What is a bridge loan used for?

To cover a short-term gap when buying a new property before selling or refinancing an existing one.

Are bridge loans interest-only?

Often yes. Most require monthly interest-only payments and a balloon payoff from sale or refinance at exit.

How much can I borrow on a bridge loan?

Lenders cap by LTV or CLTV. Compute eligible advance from collateral value minus existing liens and policy limits.

What fees should I expect?

Common costs include points, underwriting, appraisal, title/escrow, doc prep, and sometimes extension or exit fees.

How do I estimate my monthly payment?

Use interest-only math: \(L \times i/12\). Example: $400,000 at 10% ≈ $3,333.33 per month.

What happens if my home sells late?

You may pay additional interest or an extension fee. Model a longer term to see the impact before committing.

Can I prepay a bridge loan early?

Usually yes, but check for minimum interest, prepayment charges, or notice requirements in your agreement.

Is CLTV different from LTV?

LTV uses the subject property only; CLTV includes your new bridge balance plus existing liens against the collateral.

Will a bridge loan affect my mortgage approval?

It can. Underwriters consider the bridge’s payment or payoff in debt ratios; plan your timing and exit carefully.

Can investors use bridge loans?

Yes. They are common for flips, value-add rehabs, or quick acquisitions pending permanent financing.

Is interest on a bridge loan tax-deductible?

It depends on jurisdiction and use. Consult a qualified tax professional for rules applicable to your situation.