What is a bridge loan? A bridge loan (also called a swing loan) is short-term financing secured by the home you already own, used to buy your next home before the first one sells. It turns equity you can't touch yet into a down payment and closing funds, and you pay it off when your current home closes.
Is it right for you? It can be, if your income can carry two homes and the bridge payment for a while. Fannie Mae's Selling Guide requires the lender to document exactly that, and with Scottsdale single-family homes averaging 75 days on market in October 2026, it's worth planning for a sale that takes a couple of months.
Data note: Loan rules are from Fannie Mae's Selling Guide (B3-4.3-14, Bridge/Swing Loans; B3-6-05, Monthly Debt Obligations). Market figures are from the Phoenix REALTORS/ShowingTime Local Market Update for Scottsdale, October 2026. Mortgage rates are from Freddie Mac's Primary Mortgage Market Survey, Nov. 12, 2026. Read November 13, 2026.
How a Bridge Loan Works
- You borrow against your current home's equity, usually before it sells
- You use the funds for the down payment and closing costs on the new home
- You buy the new home with a regular mortgage
- When the old home closes, the sale proceeds pay off the bridge loan
- Terms vary by lender: Fannie Mae says it has no specified limit on the term of a bridge loan, so get the rate, fees and repayment terms in writing
Fannie Mae's Rules, in Plain English
If your new home is financed with a conventional loan sold to Fannie Mae, the Selling Guide sets three guardrails:
- No cross-collateralization: the bridge loan can't be secured by the new property
- Ability to carry everything: the lender must document that you can pay the new home, the current home, the bridge loan and your other obligations
- Debt-to-income: the bridge loan counts as a contingent liability in your DTI unless you provide a fully executed sales contract on your current home and confirmation that any financing contingencies have cleared
What that means: a bridge loan is easiest to qualify for once your current home is under contract with the buyer's financing contingency cleared, or if your income comfortably covers both payments.
Why Timing Matters in Scottsdale Right Now
From Phoenix REALTORS' October 2026 report for Scottsdale single-family homes:
- Days on market: 75
- Months of supply: 4.2
- Pending sales: 208, down 43.5% from October 2025
- Median sales price: $1,225,000, up 5.6% year over year
- Percent of list price received: 96.8%
And from Freddie Mac (Nov. 12, 2026): the 30-year fixed averaged 7.11% and the 15-year 6.45%.
Buyers have time and choice, which helps when you're buying. But as a seller, plan for a realistic marketing period and price carefully, since every extra month means another month of double payments.
Alternatives to a Bridge Loan
- HELOC before you list: a line of credit on your current home can work like a bridge; open it before listing. Compare in HELOC vs. cash-out refinance
- Home-sale contingency: your offer depends on selling your home; less competitive, but no double payments
- Sell first, then buy: use a rent-back or short-term rental to bridge the gap. See should I sell my house before buying another
- Carry both mortgages if your income and reserves support it
- Cash or portfolio assets: some buyers borrow against investments; Fannie Mae has separate rules for that
Questions to Ask a Lender
- What's the rate, fees and maximum term?
- Are there monthly payments, or is interest deferred until payoff?
- How much of my equity can I borrow?
- How will the bridge loan affect my DTI on the new mortgage?
- What happens if my home hasn't sold when the term ends?
“When a client wants to move up without the stress of a rent-back, a bridge loan can be a smart tool, but only when the numbers still work if the first home takes a little longer to sell. I start every buy-before-you-sell plan with a pricing conversation for the current home, because that's what really determines how long you'll be carrying two payments.”
— Elizabeth Vijan, Tackett Team, eXp Realty
Frequently Asked Questions
What is a bridge loan in real estate?
Short-term financing secured by your current home that funds your next purchase before the first home sells.
How does a bridge loan affect my mortgage approval?
It counts in your DTI unless your current home has a fully executed sale contract with financing contingencies cleared.
Can a bridge loan be secured by the new house?
Not for Fannie Mae conventional purchases; it can't be cross-collateralized against the new property.
What are the alternatives to a bridge loan?
A HELOC opened before listing, a sale-contingent offer, selling first with a rent-back, or carrying both mortgages.
Planning a Move-Up in Scottsdale or Phoenix?
I'll help you map the sequence (price, list, buy, close) and coordinate with your lender so both transactions line up.
Elizabeth Vijan | Tackett Team, eXp Realty
Phoenix & Scottsdale Real Estate
Talk With Elizabeth · Call or text 602-885-7752
Sources: Fannie Mae Selling Guide: Bridge/Swing Loans · Fannie Mae Selling Guide: Monthly Debt Obligations · Phoenix REALTORS/ShowingTime: Scottsdale October 2026 (PDF) · Freddie Mac Primary Mortgage Market Survey
Disclaimer: General information, not lending, legal or tax advice. Loan programs and terms vary; consult a licensed mortgage professional. Information deemed reliable but not guaranteed. Equal Housing Opportunity.
Tackett Team, eXp Realty · Get in touch