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A short-term loan intended to bridge the gap between other transactions. (1) Temporary financing obtained at the end of a construction loan period but before permanent financing can be arranged. (2) A loan obtained by a home buyer when the equity from an existing home is necessary to provide the down payment for a new home,but the buyer has been unable to sell his or her old home as of that time (frequently offered by employers who transfer employees to new cities).
A short-term loan,usually from a bank,that “bridges”the period between the closing of a home purchase and the closing of a home sale.
To qualify for a bridge loan, the borrower must have a contract to sell the existing house. This is the same as a “swing loan.” See Housing Investment/Buying the Next Home Before the Existing One