Buying in Woodside before you sell can feel like solving a puzzle with the clock ticking. You want the right home without risking a double move or a weaker offer tied to your sale. The good news is you have options to create breathing room. In this guide, you’ll learn how bridge loans work in Woodside, what they cost, where they shine, and how to move from plan to keys with confidence. Let’s dive in.
What a bridge loan is
A bridge loan is a short-term loan that helps you buy your next home before your current one sells. It typically taps your existing home’s equity to fund your down payment or temporarily pay off your current mortgage so you can write a stronger, non-contingent offer. As a reminder, these are short-term and higher-cost compared to regular mortgages, which is why you use them strategically. For a plain-English overview of how these loans work, review this consumer guide to bridge loans.
Why bridge loans fit Woodside
Woodside has many luxury and one-of-a-kind properties. Appraisals can be complex, and competitive offers often rise to the top. That makes flexibility and speed valuable. Recent coverage of high-end Peninsula sales highlights how unique estates can drive pricing and appraisal dynamics, which is why cash-like or contingency-free terms can help you compete in this niche market. See this local context in SFGate’s reporting on a record Bay Area estate sale.
How a buy-before-you-sell bridge works
Bridge loans can be structured two main ways. Both are short-term and repaid when your current home closes.
Payoff-style bridge (first lien)
- The bridge loan pays off your existing mortgage and may free up additional cash.
- You carry one short-term bridge payment until your home sells.
- Once the sale closes, you pay off the bridge in full.
- This setup can make qualifying for the new mortgage easier since the old mortgage is gone.
Down-payment bridge (second lien)
- The bridge loan sits behind your current mortgage and provides cash for your next down payment.
- You may carry two payments until your home sells, although some products are interest-only or defer payments.
- Works well if you have strong equity and want to avoid paying off the first mortgage early.
For more on common structures and lender differences, see this bridge financing primer.
What it costs and how long it takes
Rates and fees to expect
- Rates are usually higher than traditional mortgages. Many borrowers see ranges in roughly the 6% to 12% zone, with exact pricing based on credit, equity and loan size.
- Closing costs often land around 1% to 3% of the bridge amount, including origination, appraisal, title and escrow. Some lenders charge extension fees if your home takes longer to sell.
- A few programs allow interest-only payments or no payments until your sale closes.
For typical ranges and cost drivers, review this bridge loan cost overview and this fee breakdown example.
Typical timeline
- Most bridge loans are designed for 3 to 12 months.
- Many lenders can close a bridge loan faster than a standard mortgage, sometimes in days to a couple of weeks.
- Plan conservatively and build a buffer in case your sale takes longer.
Get a high-level sense of timelines in this buy-before-you-sell explainer.
What lenders look for
Equity and loan-to-value
Lenders usually want meaningful equity in your departing home. Combined loan-to-value caps commonly top out around 75% to 80%. If you have at least 20% equity and solid credit, you may be a stronger candidate. See common expectations in this bridge basics guide.
Income and DTI with a departing residence
Underwriters must count your recurring obligations when qualifying you for the new mortgage. Bridge or swing loan payments are typically included in your debt-to-income ratio unless you have a fully executed sales contract on your current home and certain conditions are met. Review the details in the Fannie Mae Selling Guide.
Jumbo coordination in Woodside
Many Woodside purchases exceed conforming loan limits, so you may pair a bridge with a jumbo mortgage. Requirements and pricing differ for jumbo loans, so work with lenders who regularly handle Bay Area jumbo plus bridge scenarios. For context on current conforming limits, see this FHFA limit announcement.
Regulatory note
Temporary bridge loans with terms of 12 months or less are addressed under federal mortgage rules. If you are evaluating a specialty product, ask your lender how the program is treated under federal guidance. You can read the relevant commentary from the Consumer Financial Protection Bureau.
Alternatives to compare
- HELOC or home equity loan. Often lower rates than a bridge, but they still count in DTI and may not give you cash fast enough for a competitive, contingency-free offer. See pros and cons in this comparison.
- Buy-before-you-sell platforms. Some programs can make a cash offer on your behalf or advance funds with a fee. Availability and costs vary by market, so review each provider’s disclosures, such as Homeward’s program overview.
- Contingent offer with a strong plan. If market conditions allow, a contingent offer can save on short-term financing costs, but it is usually weaker in competitive segments.
- Cash or liquidating investments. No loan fees, but consider tax and liquidity impacts before selling assets to fund your down payment.
Key risks and how to manage them
Carrying two mortgages
If your home does not sell before the bridge term ends, you could face multiple payments or need an extension. Build a conservative sale timeline, keep cash reserves, and set a realistic list price with your agent. For a consumer overview of these risks, see this bridge loan explainer.
Appraisal and valuation gaps
Unique Woodside properties can appraise below contract price, which may create a cash shortfall. Prepare for potential appraisal variance, and discuss appraisal-gap strategies before you write an offer. Local luxury reporting, like this SFGate feature, shows how one-of-a-kind estates can complicate comps.
Taxes and closing costs
- San Mateo County documentary transfer tax is generally $1.10 per $1,000 of consideration at recording. Learn more from the County Clerk-Recorder.
- California’s base property tax is governed by Proposition 13 at about 1% of assessed value plus voter-approved assessments. A sale triggers reassessment on your next home. For background, see the Legislative Analyst’s Office overview.
Step-by-step plan for a Woodside move
- Clarify budget and reserves. Model a few sale-price scenarios to stress test your plan.
- Pre-underwrite your new mortgage and the bridge. Confirm DTI, reserves and jumbo requirements with an experienced lender. Reference the Fannie Mae DTI framework to understand how payments may be counted.
- Gather documents. Recent mortgage statements, income docs, title info, and a listing plan or appraisal for your current home are common asks.
- Order valuations. Your bridge lender may need its own appraisal, which can take longer for estates or acreage.
- Close on the bridge loan. Many programs can close in days to a couple of weeks, then you proceed to close on the purchase. See typical timeframes in this U.S. News guide.
- Launch your sale. Go live quickly with polished marketing and realistic pricing. Track your bridge term and discuss extension options early if needed.
Is a bridge loan right for you?
A bridge loan can be a smart tool if you have solid equity, stable income, and want to write a stronger, non-contingent offer without moving twice. It may not fit if your DTI is tight or your sale timeline is uncertain. The key is an honest cash-flow plan, accurate pricing on your current home, and the right lending team to execute.
Ready to map your move in Woodside? Let’s build a plan that balances speed, certainty and cost so you can buy with confidence and sell on your timeline. Connect with Allison T. Paulino to talk strategy and next steps.
FAQs
What is a bridge loan and how does it help me buy before I sell?
- A bridge loan is a short-term loan that taps your current home’s equity to fund your next purchase so you can write a stronger offer without waiting for your sale, as explained in this bridge loan overview.
How expensive are bridge loans compared to regular mortgages?
- Expect higher rates and fees than a standard mortgage, often roughly 6% to 12% with 1% to 3% in costs, though exact pricing varies; see typical ranges in this cost guide.
Will my bridge loan payment count in my debt-to-income ratio for the new loan?
- Usually yes; lenders count bridge payments unless you have a fully executed sales contract and meet specific conditions noted in the Fannie Mae Selling Guide.
How fast can a bridge loan close in the Bay Area?
- Many programs can close faster than a traditional mortgage, sometimes in days to a couple of weeks; see typical timelines in this U.S. News explainer.
What local taxes and fees should I expect when I sell in San Mateo County?
- Sellers typically see a documentary transfer tax of $1.10 per $1,000 at recording, and buyers should plan for property tax based on Proposition 13 rules; details are on the County Clerk-Recorder’s page and the LAO overview.
