What is Bridging Finance?
Sometimes when you’re buying a new property, you need to settle before your current home sells. That gap between transactions is where bridging finance can help. It’s a short-term loan that lets you complete your purchase while you wait for sale proceeds to come through.
Because you may technically hold two loans at once, bridging finance is usually set up as interest-only to keep repayments lower during the overlap period. Getting the structure right from the start is important — the wrong setup can leave you with unnecessary debt once your sale completes.
Types of Bridging Finance
Closed bridging finance
This applies when you’ve already sold your existing property and have a confirmed settlement date. You buy your new home first, then your sale settles soon after. For that brief time you own both properties — but the bank has confidence because it knows when and how much your sale will bring in.
Open bridging finance
This is when you’ve bought a new property but haven’t yet sold your current home. Because there’s no confirmed sale date or price, this option carries more risk. Many New Zealand banks don’t offer open bridging finance for that reason — but some non-bank or specialist lenders may.
Finding the Right Lender
Each situation is unique. As a mortgage broker Tauranga, we work with major banks and reputable non-bank lenders who can structure bridging finance to match your timeline and goals. Whether you’re buying in Pyes Pa or elsewhere in the Bay of Plenty, we’ll help you compare options and choose a setup that protects your equity and keeps things stress-free.
Talk to us before you finalise your sale or purchase — a quick chat can help you plan the timing and avoid surprises.
Talk to Best Mortgages
Whether you’re buying your first home, refinancing for a better deal, or planning your next investment move, now’s the perfect time to get expert advice. Our friendly team at Best Mortgages is based right here in Tauranga and helps Kiwis across the Bay of Plenty make sense of these market shifts. We speak plain English (and a bit of Kiwi slang when needed) and work for you – not the banks – to find the right solution.
Contact us today for a no-obligation chat and we’ll walk you through the latest rates, rules, and opportunities tailored to your goals. Let’s turn those property dreams into reality — we’re only a phone call or coffee catch-up away. See our reviews to know why we’re called the best. Also stay up to date with our latest news for the best tips and advice.
Best Mortgages — Operated by Ewald Biesenbach (FSP 320426) under The Best Limited (FSP 724451 – NZBN 9429043352067). Licensed under the Financial Services Legislation Act 2019.
How long does bridging finance usually run?
Most bridging loans are short term — usually a few weeks to a few months — depending on your sale and purchase settlement dates. We’ll match the loan term to your timeline so you’re not paying for longer than necessary.
Is bridging finance interest-only?
Typically yes. Bridging loans are often structured as interest-only to keep repayments lower during the overlap period. Once your sale settles, the bridging loan is repaid and your main home loan continues as normal.
What’s the difference between closed and open bridging?
Closed bridging applies when you’ve already sold your current home and have a confirmed settlement date — lenders are more comfortable with this. Open bridging means your current home isn’t sold yet, which is riskier; many NZ banks don’t offer it, but some non-bank lenders may.
Can I get bridging finance if my home hasn’t sold yet?
It’s possible through selected non-bank or specialist lenders, but approval depends on your equity, income, and how easily your property is likely to sell. We’ll assess your position and present it to the most suitable lender.
What are the main risks with bridging finance?
The key risks are a delayed sale or a lower-than-expected sale price, which can extend the bridging period or affect your final loan balance. Good timing, realistic pricing, and the right structure help reduce those risks.
