Use a Bridge Loan for Your DFW New Build | Refind Realty DFW
How to Use a "Bridge Loan" to Secure Your DFW New Build Before Your Current House Sells
Direct Answer
A bridge loan allows you to purchase a new construction home while your current home is still on the market by using your existing equity as collateral. In Dallas–Fort Worth, this enables you to make a non-contingent offer, which builders often prioritize for their guaranteed closing dates. While these loans carry higher interest rates—typically around 8.49% to 12.99% in early 2026—they provide the speed and flexibility needed to act quickly on high-demand properties without the need for temporary housing.
Book your Home Goals consultation to map your bridge loan strategy: https://stevenjthomas.com/home-goals
1. How a Bridge Loan Works for DFW New Builds
A bridge loan is a temporary financing solution, usually lasting 6 to 12 months.
Equity Access: You can typically borrow up to 80% of your current home's value.
Lump Sum Funding: Unlike construction draws, bridge loans are usually paid out in a lump sum at closing.
Fast Approval: In a competitive market, these loans can be approved in as few as 72 hours and funded within 2 weeks.
2. Why Builders Prioritize Non-Contingent Buyers
Builders in North Texas favor certainty.
Closing Confidence: A bridge loan eliminates the home sale contingency, making your offer as strong as a cash buyer's.
Timeline Alignment: Builders have strict production schedules; a bridge loan ensures you can close precisely when the home is finished, regardless of when your old home sells.
3. The Costs: Interest Rates & Fees
Because bridge loans are short-term and higher risk for the lender, they come at a premium.
Interest Rates: Expect rates roughly 2% above the prime rate. Current 2026 rates for residential bridge products in Texas often range from 8% to 12%.
Closing Fees: Expect to pay between 1.5% and 3% of the loan amount in closing costs, including appraisals and origination fees.
Payment Flexibility: Many lenders offer interest-only payments or may even defer payments entirely until the home sells, easing your monthly cash flow.
4. Qualification Requirements
Securing a bridge loan in 2026 requires a solid financial profile:
Substantial Equity: Most lenders require at least 20% to 30% equity in your current home.
Credit Score: A favorable credit score, typically above 650 to 700, is required for the best rates.
Exit Strategy: Lenders will demand a clear plan for repayment, usually the finalized sale of your current property.
5. Neighborhood Spotlights: Where Timing is Key
DeSoto & Midlothian: In high-demand areas where new phases sell out quickly, a non-contingent offer via a bridge loan can be the only way to secure a preferred lot.
Red Oak & Glenn Heights: As inventory grows, builders may accept contingencies, but a bridge loan buyer often gets the best incentives and "spec" home pricing.
Conclusion
A bridge loan is a powerful tool for DFW buyers who have found their dream new build but are stuck behind a home sale. While it is a more expensive option than traditional financing, the ability to buy without a contingency provides unmatched peace of mind and competitive leverage with builders. It allows you to focus on your move rather than the stress of a perfectly timed double-closing.
Ready to see if your current home's equity can fund your next move? https://stevenjthomas.com/home-seller-score
Key Takeaways
Non-Contingent Power: Make an offer that builders can't refuse by removing the home sale requirement.
Speed to Close: Get approved in days to secure a fast-moving "spec" home.
Leverage Your Equity: Tap into up to 80% of your current home's value for your new down payment.
Higher Rates: Plan for interest rates roughly 2% higher than standard 30-year mortgages.
Move Once: Avoid the hassle and cost of temporary rentals by moving directly into your new build.
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