15 May 2026 Bridging Loans in South East Melbourne: Your 2026 Guide
South East Melbourne homeowners have more options than ever when it comes to buying their next home before their current one sells. Whether you’ve found the perfect property in Toorak – Glen Iris or St Kilda and need to act fast, bridging finance can make the move possible without the stress of timing two settlements perfectly.
The challenge many homeowners face is simple: you’ve found your next home, but your current property hasn’t sold yet. Auction clearance rates in South East Melbourne remain competitive, and the right property doesn’t wait for your settlement timeline to align.
EverLend helps South East Melbourne homeowners work through their bridging loan options across 60+ lenders, completely free of charge.
Here’s what you need to know about bridging finance before you approach a lender.
Key takeaways
- Bridging loans temporarily combine both property debts into one loan for up to 12 months.
- Lenders typically require at least 20% equity across both properties combined.
- Bridging loan policies and rates vary significantly across lenders – comparison is essential.
How does a bridging loan work?
A bridging loan lets you buy your next property before your current one sells, by temporarily combining both debts into a single loan. You make interest-only repayments during the bridging period, typically up to 12 months, and the loan reduces once your existing property settles. Your exact structure depends on your equity, timeline, and which lender you use – which is what we work through with you in a free consultation.
What should South East Melbourne homeowners know about bridging loan costs?
Bridging loans carry a premium above standard variable rates – typically 1-2% higher than your existing home loan rate, on top of establishment fees and valuation costs. The holding cost compounds quickly when you account for interest on both properties, plus ongoing expenses like council rates, insurance and body corporate fees across 6-12 months. Getting your existing property sold promptly is the single most effective way to control those costs.
Up to 12 months
Standard maximum bridging period across most lenders, with some extending to 24 months in specific circumstances.
|
Like to know which banks & lenders work best for bridging finance? Know where you really stand and what’s possible, so you can plan with total confidence. 5.0 on GoogleLocal expertsFree service
Prefer to talk now? Call 03 7036 3356 |
Are there government schemes for bridging finance in South East Melbourne?
Key considerations for established homeowners using bridging finance:
- ›No specific government schemes: bridging loans are a private lending product and don’t qualify for first home buyer grants or stamp duty concessions.
- ›Stamp duty on the new property: payable at settlement regardless of whether you’re using bridging finance, though established homeowners typically don’t qualify for concessions.
- ›Capital gains tax considerations: if your current property is an investment, consult your accountant about CGT implications before proceeding.
- ›Off-the-plan duty concession (VIC): if your new purchase is off the plan, VIC’s temporary duty concession excludes post-contract construction costs from the dutiable value, which can reduce your stamp duty bill. This applies to contracts entered into before 21 April 2027 (subject to legislation – confirm the current end date with the SRO).
How do mortgage brokers help South East Melbourne homeowners get bridging finance approved?
Step 1: Talk to us
Get in touch and we’ll assess whether bridging finance suits your situation and what options are available across our 60+ lender panel.
Step 2: Get your current property valued
We arrange valuations on both your existing property and the one you’re buying. This determines your available equity and maximum borrowing capacity.
Step 3: Compare lender structures
Different lenders structure bridging loans differently. Some use a single loan that increases temporarily, others use two separate facilities. We identify which structure works best for your situation.
Step 4: Submit your application
We handle the application process with your chosen lender, coordinating between both properties and managing the documentation requirements.
Step 5: Arrange settlement coordination
Your solicitor handles the legal side, but we work with them to ensure the bridging facility is ready when you need to settle on the new property.
Step 6: Monitor the bridging period
During the bridging period, we stay in touch to track your existing property’s sale progress and coordinate the loan reduction once it settles.
What mistakes do South East Melbourne homeowners make with bridging loans?
The biggest mistake homeowners make is assuming their current bank will offer the most competitive bridging solution. Bank policies on bridging finance vary significantly, and some won’t bridge at all depending on your loan-to-value ratio or property type. Shopping around often reveals better rates, higher borrowing limits, or more flexible terms.
The second mistake is underestimating the holding costs. During the bridging period, you’re paying interest on both properties plus any ongoing costs like rates, insurance, and body corporate fees. These costs add up quickly over 6-12 months, which is why getting your existing property sold promptly matters for your budget.
Who qualifies for bridging finance in South East Melbourne?
Most established homeowners qualify for bridging finance if they have sufficient equity in their current property. Lenders typically require at least 20% equity after accounting for both loans, though some specialist lenders work with lower equity positions. Your income needs to service both properties temporarily, which is where lender comparison becomes valuable.
Key eligibility criteria most lenders assess:
- ›Minimum equity requirement: typically 20% across both properties after the bridging loan is in place.
- ›Income serviceability: you need to demonstrate capacity to service both loans during the bridging period, usually up to 12 months.
- ›Property types: most residential properties qualify, though some lenders have restrictions on units, particularly those in high-rise developments.
- ›Exit strategy required: lenders need a clear plan for how you’ll repay the bridge, typically through the sale of your existing property.
|
Like to know which banks & lenders work best for bridging finance? Know where you really stand and what’s possible, so you can plan with total confidence. 5.0 on GoogleLocal expertsFree service
Prefer to talk now? Call 03 7036 3356 |
Frequently Asked Questions
How much does a bridging loan cost in South East Melbourne?
Bridging loans typically carry a premium of 1-2% above standard variable rates. You’ll also pay establishment fees, valuation costs, and potentially break costs if you’re refinancing your existing loan to access the bridging facility.
How long can I keep a bridging loan in South East Melbourne?
Most lenders offer bridging terms of 6-12 months, with some extending to 24 months in specific circumstances. The key is having a realistic timeline for selling your existing property and a backup plan if the sale takes longer than expected.
Can I use a bridging loan to buy an investment property in South East Melbourne?
Yes, but the structure differs from owner-occupier bridging loans. Investment bridging loans typically require higher equity and different serviceability calculations, and the interest is generally tax-deductible as an investment expense.
What happens if my South East Melbourne property doesn’t sell during the bridging period?
Most bridging loans can be extended, though this usually incurs additional costs and requires lender approval. Some lenders will convert part of the facility to a standard investment loan if needed, though this depends on your equity position and serviceability.
Do I need to sell my current property to pay out the bridging loan?
Not always. If you have sufficient income and equity, you might choose to convert your existing property to an investment and maintain both long-term. This requires meeting investment loan serviceability criteria and has capital gains tax considerations worth discussing with your accountant.
Should I use a broker or go to my bank for bridging finance?
A mortgage broker, every time. Bridging loans are a specialist product, and lender policies vary dramatically in terms of rates, equity requirements, and loan structures. Your current bank may not even offer bridging finance, or their terms might not suit your situation compared to what’s available across a full lender panel.
Can I get a bridging loan for an off-the-plan purchase in South East Melbourne?
Yes, though the timeline needs careful management. Off-the-plan purchases typically settle 12-24 months after purchase, so a standard bridging loan might not cover the full period. Some lenders offer extended bridging facilities for off-the-plan purchases, but alternatives like using existing equity through a construction loan might be more cost-effective.
Your Next Steps
Getting your bridging finance structure right is about more than finding a low rate. The right lender for your situation can mean better equity utilisation, more flexible terms, and a loan structure that fits your timeline – all things that vary significantly across our 60+ lender panel.
The right lender for bridging finance depends on your situation, and that’s a conversation worth having. Talk to the EverLend team or call 03 7036 3356, and we’ll compare your options across 60+ lenders at no cost to you.
|
External Resources
EverLend · St Kilda and South East Melbourne · General information only – this article does not constitute financial advice. Please consider your own circumstances and seek professional advice before making any financial decisions. · Last updated 16 July 2026