How this number is made
A bridge loan covers the gap between buying the next house and selling the current one. Many are interest-only and short. This page is the interest for the months you type. Origination fees and the risk that the sale slips are not included.
- Months should be a conservative hold, not the best case.
- The rate on a bridge is often higher than a first mortgage. Type the one in the commitment.
Formula
Monthly interest = balance × APR ÷ 12. Total interest = monthly × months.
Worked example
With the figures already in the form, interest for the hold is $2,667.
Questions
Do I pay the balance down?
Not in this sketch. It is interest-only. A lump repayment of principal at the sale is assumed, not modeled as a payment.
What if the sale takes longer?
Add months. The interest grows in a straight line because the balance does not fall.