Buying your next home in San Francisco while selling your current one can feel like a race against the clock. If you are shopping in Balboa Terrace or nearby single-family neighborhoods, you know that strong, clean offers often win. You also want to avoid a double move or short-term housing if you can. This guide explains how bridge loans work for local sellers, what they cost, how to manage risks, and the steps to plan a smooth, same-time move. Let’s dive in.

Why Balboa Terrace sellers consider bridge loans

Balboa Terrace is a small, mostly single-family neighborhood with lower turnover and many owner-occupied homes. Listings are not frequent, which means timing matters when the right home appears. Across San Francisco, low inventory and higher prices make non-contingent offers more competitive.

A bridge loan helps you do three things:

• Remove the sale contingency so your offer is stronger.
• Close your purchase on the seller’s timeline, even if your sale needs more time.
• Keep your family’s routine intact with one move instead of two.

The value of a bridge depends on your equity, new loan plans, and local selling speed. In parts of San Francisco, paying for short-term liquidity can be the difference between winning and losing the home you want.

What a bridge loan is and how it works

A bridge loan is short-term financing that helps you buy your next home before you sell your current one, or until you place a long-term mortgage on the new property.

Common structures

• Purchase-side bridge secured by your current home. Funds are advanced against your equity to cover a down payment or even the full purchase. Often interest-only with principal due at sale or refinance.
• Open-end or temporary HELOC-style bridge. A line of credit you can draw for the purchase. Flexible, but subject to lender limits.
• Cross-collateralized second or swing loan. A second mortgage on your current home, the new home, or both, to create liquidity until your sale closes.
• Purchase money second on the new property. Your new first mortgage funds as usual, and a bridge lender records a short-term second to be paid off once you sell.
• Portfolio or private bridge lender. Faster closings and flexible underwriting, often at higher rates and fees than banks.

What lenders evaluate

• Combined loan-to-value limits and your available equity.
• Appraisal or broker opinion of value on the collateral property.
• Existing mortgage payoff amounts and any other recorded liens.
• Credit, cash reserves, and a clear exit plan to repay.
• Escrow and title coordination to place and later release liens.

Terms and repayment

• Typical terms run 3 to 12 months. Many programs offer 6 to 12 months with options to extend.
• Payments are often interest-only. Principal is paid off when your sale closes or when you refinance into a permanent loan.

Licensing in California

Bridge lenders in California should be properly licensed. You can verify licensing and review consumer finance disclosures with the state regulator. Confirm the lender’s license and complaint history before you sign.

Costs and timing to expect

Costs vary by lender, credit profile, and loan structure. Get written quotes to compare.

Rates and fees

• Interest rates are usually higher than standard mortgages due to the short term and risk profile. Many programs price in the high single digits to low double digits in recent years, but exact terms depend on your credit, LTV, and lender type.
• Typical fees can include an origination fee, appraisal, title and escrow charges, and recording costs. Some lenders also charge commitment or extension fees.

Equity and loan-to-value limits

• Many lenders require meaningful equity, often 20 to 30 percent or more. Combined loan-to-value caps commonly range from about 65 to 80 percent, depending on property type, credit, and lender. Private lenders may go higher at higher cost.

Funding timeline

• Application and underwriting often take several days to 2 or more weeks, depending on appraisal, title, and complexity.
• Funding can be as fast as a few days with private or portfolio lenders. Traditional banks may take 2 to 4 or more weeks.
• Align bridge funding with your purchase escrow. San Francisco escrows often run around 30 days, but timelines are negotiable.

Cost versus alternatives

Bridge loans cost more than long-term mortgages, but the total may be lower than a temporary rental, two moves, or losing a home you want. Compare interest plus fees against the costs of short-term housing and moving twice.

Illustrative example

• Your home appraises at 1,500,000 dollars and your current mortgage balance is 500,000 dollars, so equity is 1,000,000 dollars.
• If a lender allows up to 75 percent combined loan-to-value, the total allowed loans could be about 1,125,000 dollars.
• That means potential bridge capacity above your existing mortgage is about 625,000 dollars before fees. If you need 400,000 dollars for a down payment, the numbers may pencil, as long as you have a clear exit to sell or refinance within the term.

Risks and how to control them

Bridge financing is about trading short-term cost for timing and certainty. Plan conservatively.

Primary risks

• Your sale is delayed or falls through, which can force an extension, a refinance, or in a worst case a default.
• Double carrying costs if you hold the bridge loan and your new mortgage longer than planned.
• Higher interest cost overall, and possible prepayment or extension fees.

Controls and exit strategies

• Put the exit plan in writing. Confirm term length, extension options, fees, and any prepayment rules.
• Use conservative LTV caps and maintain buffers so you are not over-leveraged.
• Build a timing cushion. Assume your bridge will last 1 to 3 months longer than planned.
• Get pre-approved for your permanent mortgage early so you can pivot if needed.
• Track every cost. Keep a running total of interest, fees, and carrying costs so you can make informed go or no-go decisions.

Legal and tax notes

• Property transfers can trigger property-tax reassessment. California has property tax portability rules for eligible homeowners under Prop 19, but they are complex and limited. Consult a qualified tax advisor.
• Confirm title and lien order, payoff instructions, and release procedures with escrow and title.
• Verify that your chosen lender is properly licensed and that you receive all required disclosures.

Planning checklist for Balboa Terrace sellers

Before you write offers

• Estimate your equity and likely combined loan-to-value with your lender and agent.
• Choose lender type. Balance speed, flexibility, and cost among banks, credit unions, mortgage lenders, and private lenders.
• Secure conditional approval so you can present a clean, non-contingent offer when needed.
• Verify requirements like appraisal, title, mortgage payoff statements, insurance, and escrow instructions.

Offer and escrow strategy

• Use the bridge to remove your sale contingency when the competition requires it. Consider hybrids such as a brief contingency period or a rent-back to manage move timing.
• Negotiate flexible closing dates so your purchase and sale align. Use rent-backs or temporary occupancy agreements as backup.
• Prepare for double closings. Coordinate wiring schedules and payoff instructions with escrow and title to minimize overlap.

Questions to ask a bridge lender

• What is the exact rate and APR, and for how long is it locked?
• What are the origination and closing fees, and are any reserves or prepaid interest required?
• What CLTV and minimum equity are required, and how will the property be valued?
• What is the term, how do extensions work, and what are the extension fees?
• Is there a prepayment penalty?
• How fast can you fund after an executed purchase contract and appraisal?
• Will you take a first lien or second lien, and how will that affect my new mortgage?
• How will title and payoff be coordinated at sale so liens are released promptly?

Alternatives to weigh

• Sale contingency in your offer. Often weaker in competitive San Francisco situations.
• Rent-back from your buyer after your current home closes.
• Temporary housing during the gap.
• HELOC or other cash sources, which can be less costly in some cases.
• Using the same lender for the bridge and your new mortgage to simplify coordination.

How Domain SF Marin supports your plan

You want a smooth, single move with a strong offer and controlled risk. Our senior-led team brings decades of experience across San Francisco single-family neighborhoods like Balboa Terrace. We help you price, prepare, and time your sale while coordinating with your lender and escrow so funds and closings line up.

Here is how we add value:

• Neighborhood-specific pricing and comps to support appraisals and underwriting.
• Conservative, negotiation-led strategy to decide when to go non-contingent.
• Concierge listing prep, staging guidance, and premium marketing to drive a timely sale.
• Tight escrow coordination so lien placement, payoffs, and closings stay on schedule.
• Agent relationships that surface opportunities, including early-stage and off-market options.

Ready to map out a same-time move with clear numbers and a realistic timeline? Let’s connect and build a plan that fits your goals.

Domain SF Marin

FAQs

What is a bridge loan for a San Francisco home seller?

• A short-term loan that uses your current home’s equity to help you buy your next home before you sell, then it is paid off at sale or refinance.

How much equity do I need for a bridge loan in Balboa Terrace?

• Many lenders want at least 20 to 30 percent equity and often cap combined loan-to-value around 65 to 80 percent, depending on credit and lender.

How long does a bridge loan take to fund in San Francisco?

• Private or portfolio lenders may fund in days, while banks can take 2 to 4 or more weeks, depending on appraisal and title work.

Are bridge loans more expensive than other options?

• Rates and fees are higher than standard mortgages, but total cost can be lower than a rental plus two moves or losing a competitive home.

What if my current home does not sell before the bridge loan matures?

• You may need an extension, a refinance into a longer-term mortgage, or to adjust pricing and marketing to sell; plan for this risk in writing.

Will a bridge loan affect my ability to get the new mortgage?

• Yes, lenders consider your total debt and combined loan-to-value, so get pre-approved early and confirm how the bridge interacts with your permanent loan.

Is a HELOC a viable alternative to a bridge loan?

• It can be, especially if you have strong equity and a favorable rate, but limits and timing vary; compare total cost and speed with a bridge option.