Make a Non-Contingent Move in L.A. With Bridge Loans

Want to buy your next L.A. home before you sell your current one? In many Los Angeles neighborhoods, sellers prefer offers that do not depend on your home closing first. A bridge loan can give you the funds to write a stronger, non‑contingent offer while you prep and sell your current place. In this guide, you’ll learn how bridge loans work in Los Angeles, what they cost, key risks, alternatives, and a simple plan to use them wisely. Let’s dive in.

Bridge loan basics

A bridge loan is a short‑term loan that lets you tap your equity to buy your next home before your current home sells. You repay it when your old home closes or when you refinance into a permanent mortgage. NerdWallet explains bridge loans as a tactical tool to remove a sale contingency and compete in tight markets.

Why non‑contingent offers matter in L.A.

In competitive pockets of Los Angeles, listings can move quickly and sellers favor clean, non‑contingent offers. A bridge loan can help you act like a cash buyer for the down payment or payoff, which strengthens your position. This strategy is most useful when you have strong equity and a realistic plan to sell on a clear timeline.

How bridge loans work

Common structures

• Equity bridge. The lender advances part of the equity from your current home to use toward the new home’s down payment.
• Purchase bridge or swing loan. A short‑term loan secured by your current home, and sometimes both properties, repaid at sale or refinance. NerdWallet outlines these structures.

Typical terms and payments

• Most bridge loans run about 3 to 12 months.
• Payments are often interest‑only with a balloon payoff at maturity.
• Many programs allow extensions, usually for a fee. NerdWallet details typical timelines.

Qualification and LTV

• Lenders often use a combined loan‑to‑value cap around 75 to 80 percent depending on product, credit, and income.
• Strong credit and reasonable debt‑to‑income are usually required.
• Some lenders require you to take the permanent mortgage with them. See NerdWallet’s guide to lender requirements.

Costs you should expect

Bridge loans cost more than standard mortgages. In Los Angeles, marketplace data shows average bridge and hard‑money rates around the low to mid teens, with many quotes near about 10 to 11 percent and average origination fees around 3 to 4 points. Pricing varies by borrower profile and collateral. Review the local snapshot from HardMoneyHome’s Los Angeles listings.

You’ll also pay closing costs such as appraisal, title, escrow, and legal fees. These can add up to thousands of dollars. Learn what typically goes into closing costs from Investopedia’s overview.

Key risks to plan for

• Carrying two homes if your sale takes longer than expected.
• Higher interest and upfront fees that magnify total cost if timelines slip.
• Possible prepayment penalties, extension fees, or requirements to refinance with the same lender. Read the fine print. See NerdWallet’s pros and cons and Bankrate’s bridge loan guide.

When a bridge loan makes sense in L.A.

• You have ample, documented equity and strong credit.
• You’re shopping in a fast‑moving area and want a non‑contingent edge.
• You can handle double housing costs for a short period and have a backup plan. NerdWallet’s guidance aligns with these scenarios.

When it may not be right

• Your equity is thin or uncertain.
• You cannot comfortably carry two payments if the sale takes longer.
• A cheaper option like a HELOC or second mortgage is available and practical. Review common alternatives in NerdWallet’s comparison.

Alternatives to consider

• HELOC. Often lower interest than bridge loans if set up before listing your home.
• Home equity loan. Fixed second mortgage with potentially lower rates than private bridge loans.
• 80/10/10 structure. Layered financing to reduce PMI when cash and credit allow.
• Personal loan. Unsecured and usually higher rate.
• Sale contingency with protections. A kick‑out clause can let the seller continue marketing while giving you time to sell. Learn how contingency timelines work in California from US Realty Training.

Lender vetting and legal checks

• Verify licensing. Confirm the lender and loan officer are licensed through NMLS and the California Department of Financial Protection and Innovation. Start with the DFPI resource page.
• Expect disclosures. Most closed‑end mortgages trigger TRID, which means you should receive a Loan Estimate and a Closing Disclosure. Read Ballard Spahr’s TRID summary.
• Get terms in writing. Ask for all fees, interest rate and APR, payment type, balloon, prepayment penalties, and extension fees upfront. Bankrate’s guide lists the key terms to confirm.

A simple game plan

1. Run your numbers. Build a 3 to 6 month buffer in case your home takes longer to sell. NerdWallet suggests conservative planning.
2. Compare quotes. Speak with multiple lenders to compare rate, points, fees, term, and extension options.
3. Prep and price your current home. If you plan pre‑sale improvements, coordinate scope, budget, and timing. Programs like Compass Concierge can front approved prep costs that you repay at closing.
4. Set your timeline. Map key dates for purchase, sale, and payoff so escrow knows how funds will flow.
5. Keep a backup. Line up a contingency plan such as an extension, a price adjustment, or temporary housing if needed.

Red flags to avoid

• No NMLS or DFPI license visible for the lender or loan officer. Use the DFPI site to verify.
• No written Loan Estimate or refusal to disclose all fees and penalties. See what to expect in Bankrate’s overview.
• Onerous extension fees or a short fuse balloon without a realistic payoff plan.
• Requirements that limit your refinance options without clear long‑term benefits.
• Overly optimistic sale assumptions not backed by current, local market data.

Work with a local strategist

A bridge loan is a tool, not a goal. The win comes from pairing the right financing with a smart plan to prep, price, and present your current home while you secure the next one. With accredited staging expertise, data‑driven pricing, and access to Compass resources like Concierge, you can streamline the move and keep leverage at the negotiation table.

If you’re weighing a non‑contingent strategy anywhere across Los Angeles or nearby counties, let’s talk about timing, lending options, and presentation so you can move once and move well. Reach out to Karean Wrightson to get a tailored plan for your next step.

FAQs

How long do bridge loans typically last in California?

• Most run about 3 to 12 months, often with interest‑only payments and a balloon payoff at maturity. Confirm term and any extension fees with your lender. See NerdWallet’s overview.

What do bridge loans cost in Los Angeles right now?

• Marketplace data shows many Los Angeles bridge and hard‑money loans pricing near about 10 to 11 percent interest on average with roughly 3 to 4 points in origination, though quotes vary widely by profile. Check HardMoneyHome’s LA snapshot.

Can a bridge loan help my offer win in L.A.?

• Yes. Using bridge funds to remove your sale contingency can make your offer more competitive in fast markets. Learn how bridge loans support non‑contingent offers from NerdWallet.

Is bridge loan interest tax‑deductible?

• It depends on how the loan is secured and how funds are used. Interest used to buy, build, or substantially improve a qualified home may be deductible within IRS limits. Review IRS Publication 936 and consult a tax advisor.

How fast can a bridge loan close in Los Angeles?

• Private and bridge lenders often advertise fast closings, sometimes in as little as a week, depending on appraisal, title, and documentation. See timing factors described by BridgeLoanBank.

What if my current home takes longer to sell?

• Build a buffer of 3 to 6 months, know your extension options and fees upfront, and be ready to adjust pricing or timing. See planning tips from NerdWallet.