Bridging & Short-Term Finance Guidance

Overview

Bridging & Short-Term Finance Guidance is a free, no-obligation service for Hobart and Tasmanian homeowners who want to buy their next home before selling the current one, and for businesses weighing up short-term funding. We help you understand how bridging finance works, model the numbers under realistic "what if" scenarios, compare alternatives and, only if you want, refer you to a licensed lender or broker.

Hobart Loans is not a lender and does not hold an Australian Credit Licence. We don't provide bridging loans, quote rates, recommend a specific product or make credit decisions, and we can't promise approval or a fast turnaround from any lender. We can help you see the risks clearly before you commit. If you'd like an introduction to an Australian Credit Licence holder, we disclose any referral fee before making it, and you can say no.

Who it's for

• Upgraders who have found the right home in Hobart or elsewhere in Tasmania and don't want to lose it while their current home is on the market.
• Downsizers buying a smaller property before selling the family home.
• People building a new home while still living in, and later selling, their existing one.
• Business owners considering short-term funding to cover a timing gap, such as waiting on a large receivable or a property settlement.

Our in-depth article Bridging Loans: How to Buy Your Next Home Before You Sell is a good companion to this service.

What we help with

Peak debt and end debt

Bridging finance usually involves two key numbers. Peak debt is your existing mortgage plus the new purchase price and costs, plus interest that builds up during the bridging period. End debt is what remains after your current home sells. Lenders commonly need the end debt to be affordable on your income in its own right. We help you calculate both under different assumptions.

Capitalised interest and the bridging period

Many bridging loans let interest be added to the loan balance during the bridging period rather than paid monthly. That eases cash flow but increases what you owe every month the sale takes. Bridging periods are usually limited, often to somewhere around six to twelve months depending on the lender, so it's important to understand what happens if your home hasn't sold by then.

Sale price and timing risk

The biggest risk with buying first is selling for less, or later, than you expected. We stress-test your plan with a lower sale price and a longer sale period so you can see the impact before you sign anything.

Alternatives to bridging

Selling first and renting, negotiating a longer settlement on your purchase, or using a deposit bond may achieve the same goal with less risk or cost in some situations. We set out the trade-offs so you can discuss them with a licensed provider.

Short-term business finance

For businesses, short-term loans, overdrafts and invoice finance can cover timing gaps, but costs and conditions vary widely. Private and caveat loans can be fast but expensive, and business-purpose credit generally sits outside the National Credit Code's consumer protections. See types of business finance in Australia and our Business Loan Matching service.

How it works

1. Share your situation

   Send a short enquiry through the contact form with your current home's estimated value, your mortgage balance and the price range you're buying in. We reply within one business day.

2. Free guidance conversation

   We talk through timing, your income, the local market for your current home and your appetite for risk. No credit check and no obligation.

3. Scenario modelling

   We prepare illustrative peak debt and end debt calculations, including a slower sale and a lower sale price, and set out the alternatives.

4. Your written summary

   You receive the scenarios, a document checklist and the questions to put to any lender or broker.

5. Optional referral

   If you'd like to proceed, we disclose any referral fee first and, with your consent, introduce you to a licensed provider, who handles any application and credit decision.

What you'll need

• Photo ID for every borrower
• Latest statement for your current home loan
• A recent agent's appraisal or sale price estimate for your current home
• Your agency agreement or listing details, if already on the market
• Contract of sale or details of the property you want to buy
• An estimate of purchase costs, including transfer duty and legal fees
• An estimate of selling costs, including agent commission and marketing
• Recent payslips or, if self-employed, two years of tax returns
• Three to six months of bank statements
• Statements for any other debts, including cards and car loans
• A monthly budget showing how you would meet repayments on the end debt

Options compared

Advantages & watch-outs

Worked example: what a slow sale really costs

Example (illustrative only): a Hobart couple owe $200,000 on a home they expect to sell for $600,000. They want to buy a $750,000 home, with an illustrative $35,000 in purchase costs, before selling. Peak debt at the start is $200,000 + $750,000 + $35,000 = $985,000. We assume all interest is capitalised at an illustrative 8% p.a., compounded monthly, and selling costs of 2.5% of the sale price. Real lender calculations vary.

A three-month delay alone adds $20,638.23 to the end debt. Combine it with a $40,000 lower sale price and the end debt is $59,638.23 higher than planned, lifting the illustrative repayment by $357.56 a month. That's why we suggest planning around a conservative sale price and a longer sale period, and checking that the higher end debt would still be manageable. Try your own numbers in the loan calculator, and read how lenders assess loan applications to understand serviceability.

Preparing for the new loan too? Our Home Loan Readiness Review can help.