Definition
A bridge loan is a short-term mortgage that finances the purchase of a new property before the definitive close of the sale of the old one. It "bridges" the two transactions when signing dates do not coincide.
Typical operation: duration ranges from a few days to 120 days maximum at most A lenders. Amount is capped at the available equity in the old property (estimated value minus mortgage balance minus selling costs). Payments are generally interest-only, debited daily.
Pricing: rate typically prime + 1% to prime + 3% (so 7.50% to 9.50% in May 2026), plus administration fees of CA$300-500. The main precondition is a firm, unconditional purchase offer on your old property — without it, few A lenders accept, and you must turn to a private lender at much higher rates.