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Common Misconceptions about Bridging Loans

It’s no secret that bridging loans have surged in popularity in recent years. Offering speed and flexibility, bridging finance has become the new go-to solution for buyers and sellers seeking a hassle-free property sale. Even with a rise in popularity, there’s still plenty of misinformation surrounding bridging finance. Here, we debunk some common myths to provide a clearer picture of bridging finance and what it’s all about.


1. Bridging loans are too risky

It’s often assumed that because bridging loans are short term, they’re inherently risky. Like with any loan there are risks involved, such as failing to sell the property within the expected timeframe. With careful consideration of the property market and a realistic exit strategy, bridging loans can be a great, low-risk financing option.

Bridging loans simply ‘bridge the gap’ between two financial commitments. If you’re using a bridging loan to purchase a new property because you haven’t yet sold your current one, you would be utilising the equity or ‘locked up’ value in your current home to finance the next. The loan amount is dependent on the equity in your home. Once you sell your existing property, you simply repay your bridging loan.

Property Credit offers six-month loan terms with no minimums, giving sellers ample time to sell with confidence.

2. Bridging loans are too expensive

Bridging loans are designed for short-term use, so rates will often reflect the convenience, speed, and flexibility they offer. When used strategically to capitalise on opportunities or navigate timing challenges in property transactions, the benefits of bridging loans can easily outweigh the costs.

While many banks and lenders charge interest rates or fees along the way, Property Credit offers a straightforward monthly admin fee that we disclose when you apply for our service. There’s nothing to pay upfront, you simply repay the principal amount borrowed plus the monthly admin fee at the settlement of your property.

3. Bridging loans are only used as a last resort

Bridging finance is used by a wide range of property sellers, from homeowners upgrading to a larger property to investors expanding their portfolios.

Property Credit can help you access equity in your home for any number of cash-flow requirements. Covering that in-between period while you sell, bridging loans can be used to cover things like legal fees, your property advertising expenses or any pre-sale improvements you might like to make to the property before you put it on the market.

When used strategically, bridging finance can an extremely useful tool for seizing opportunities in the property market, rather than being something one turns to last minute.   

4. There’s too many hidden fees and charges

Just like a bank, non-bank lenders still have strict licensing requirements they must adhere to and both options are heavily regulated in Australia and New Zealand. Lenders have to be transparent about the costs and fees related to the loan they are providing so whether you obtain bridging finance through a bank or non-bank lender, you can trust that both options are safe, well-regulated and secure.

A number of factors (like the stage you’re at in your property sale, eg. just listed or under contract) will determine how much funding Property Credit can provide. For a quick quote, simply apply online and you’ll be given a funding summary at the beginning of the application or you can use our handy funding calculator for an estimate.

5. Approval is slow and complicated

While applying for bridging finance requires thorough assessment, approval is still generally much quicker than traditional loans. Subject to receiving all necessary documentation, Property Credit can offer finance in as little as a few hours.

Visit for more information on our services or you can contact us on 1300 829 536 (au) or 03 668 2144 (nz).

This article is for general information purposes only and is not intended as financial product advice. Consider seeking independent financial advice that relates to your individual circumstances.

Buy and sell property on your terms

There's so much to consider when buying or selling. Below are just some of the opportunities equity release can offer over the course of a property sale. 

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Furniture & Home Staging

Cover the costs of furniture and home decor staging for your property for sale.
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Bridging Loans

Selling your property? Access up to 80% of its value with a Bridging loan.
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Buyer Deposit Facility

Fund your auction deposit using equity from the property you’re selling.
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Equity Release

Selling your property? Access up to 80% of its value.
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Property Advertising

Fund up-front advertising costs when selling your property.
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Pre-sale Improvements

Increase saleability with pre-sale improvements and staging.
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Investment Property Expenses

Cover costs related to your investment property and repay with rental income.
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GST Loan

Need to fund the GST on your commercial property purchase? We've got you covered.

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