Buying your next Beaverton home while you still own one can feel like a high‑wire act. You want the right house, a clean offer, and a smooth move without taking on too much risk. The big question is simple: do you use a bridge loan to buy first, or make a contingent offer that depends on selling your current home? In this guide, you’ll compare costs, risks, and timelines so you can choose the path that fits your goals and today’s Beaverton market. Let’s dive in.
Bridge loan basics
A bridge loan is short-term financing that covers the gap between buying your next home and selling your current one. Terms often run 3 to 12 months. Many lenders structure interest‑only payments, and some allow deferred payments that roll up at payoff.
Rates are usually higher than standard mortgage rates, and you will see origination fees and closing costs. Lenders typically require strong equity in your current home and a clear exit plan, such as sale proceeds or refinancing. Banks, credit unions, mortgage lenders, and private lenders may offer bridge loans, and consumer rules generally apply to many residential loans.
Contingent offer basics
A contingent offer makes your purchase dependent on selling your existing home within a set timeframe. Common versions include a home‑sale contingency that requires both sale and closing, or versions that specify a marketing period. Deadlines matter, and the contract should outline how and when you remove the contingency.
Sellers often reserve the right to keep marketing the home and accept backup offers. If a backup offer appears, you may need to remove your contingency on short notice or step aside. In competitive markets, sellers tend to favor clean offers with fewer contingencies.
Beaverton market factors
Beaverton sits within the Portland metro, so local conditions reflect regional supply, demand, and interest rates. In a multiple‑offer environment, non‑contingent offers and quick closings usually win. When inventory is higher and days on market stretch out, sellers may be more open to contingencies.
To judge competitiveness, look at months of inventory, median days on market, list‑to‑sale price ratios, and how often multiple offers are happening. Local MLS data, regional Realtor reports, and recent neighborhood sales are helpful. Your agent can outline what sellers are prioritizing right now in your price range.
Cost comparison
Bridge loans carry direct financing costs. You will likely pay an origination fee, higher interest than a first mortgage, and standard closing expenses. Because timing can be unpredictable, you may carry two housing payments for a period depending on your structure.
Contingent offers do not add a special financing fee. The indirect costs can show up in other ways. You might need to offer a higher price or stronger terms to compete. If your sale takes longer, you carry your current mortgage until it closes. Tight contingency deadlines can create pressure to accept a lower offer on your home just to keep your purchase alive.
Speed and certainty
A bridge loan can make you look non‑contingent from the seller’s perspective. That increases certainty and can speed up closing. It can also give you more flexibility on move‑out and possession timing.
A contingent offer introduces uncertainty for the seller because your purchase depends on your sale. Many sellers in faster markets prefer the cleaner alternative when they have options.
Risk and eligibility
Bridge loans add cost and exposure. If your current home takes longer to sell, interest and fees accumulate. If the market shifts, you could carry more debt for longer than planned. Lenders typically want strong equity and solid credit, and they will review your total debt picture across both homes.
Contingent offers lower direct costs, but you could lose the home if the seller declines your contingency or accepts a stronger backup offer. Short deadlines may push you to compromise on your sale terms.
Oregon contracts
Standard Oregon purchase forms include detailed contingency language. Your contract should spell out deadlines, how notices are delivered, and what happens if a seller receives a backup offer. The seller’s right to keep marketing and accept backups is often part of these clauses.
For financing, federal lending rules and state consumer protections apply to many residential loans. Bridge lenders can vary, so request full written disclosures. Sellers must complete required property disclosures regardless of financing structure. If your situation is complex, consider advice from a lender and, when needed, a real estate attorney familiar with Oregon contracts.
Decision checklist
Use this step‑by‑step framework to choose with confidence:
- Assess market competitiveness
- Check days on market, sale‑to‑list ratios, and how often multiple offers appear in your Beaverton segment.
- If many winning offers are non‑contingent, a bridge solution or other non‑contingent approach may be needed.
- Determine financial capacity
- Estimate your equity and net proceeds after selling costs.
- Talk to lenders early about pre‑approval, bridge availability, and total costs.
- Decide whether you can comfortably carry two payments in a worst‑case scenario.
- Estimate timelines and risk tolerance
- Use recent comparable sales to gauge how quickly your home could sell.
- Decide how long you are comfortable paying bridge interest, if applicable.
- Compare scenarios side by side
- Best case, mid case, worst case for both paths.
- Include bridge fees, interest, carrying costs, and any potential price concessions to compete with a contingency.
- Consider hybrid strategies
- Pair a contingency with stronger terms, such as larger earnest money or flexible possession.
- Use a HELOC as a lower‑cost bridge if available.
- Sell first and rent for a short period.
- Use a contingency with a short removal window to reduce seller risk.
- Nail contract details
- If contingent, tighten deadlines, notice methods, and what happens if a backup offer appears.
- If using a bridge loan, sync closing dates, payoff procedures, and lender timelines with your contract.
Practical examples
The following illustrations are hypothetical and for planning only. Always get current quotes and terms from your lender.
Example: Contingent offer
- You want a $750,000 home and expect to sell your current home for about $600,000.
- You include a home‑sale contingency with a 60‑day marketing period. The seller can accept backup offers. If a backup appears, you must remove the contingency within the stated deadline or step aside.
- Pros: No bridge interest and lower upfront cost.
- Cons: The seller may decline, or you could lose the house to a non‑contingent buyer.
Example: Bridge loan cost snapshot
- You need $150,000 to bridge the gap for down payment and closing.
- Hypothetical terms: 8% annual interest, 2% origination fee, 6‑month term.
- Origination fee: 2% of $150,000 = $3,000.
- Interest: 8% of $150,000 = $12,000 per year, or about $6,000 over 6 months.
- Estimated bridge cost for 6 months: about $9,000 plus appraisal and closing fees.
- Pros: Your offer looks non‑contingent and more attractive.
- Cons: Short‑term financing cost and risk if your sale takes longer than planned.
Alternatives to weigh
- Strengthen a contingent offer. Increase earnest money, tighten timelines, and offer flexible possession. These steps can offset some seller concerns without taking on bridge debt.
- Use a HELOC. If you have substantial equity and qualifying income, a HELOC can provide funds at a potentially lower cost than a bridge loan. Terms vary by lender.
- Sell first, then buy. This removes financing risk, though it may require temporary housing. It can be the most cost‑controlled option in some markets.
Next steps in Beaverton
Start by gauging your segment of the Beaverton market and clarifying your numbers. Then compare total costs and timelines across both paths. If the market is competitive and your equity is strong, a bridge loan can increase certainty and speed. If conditions are more balanced and you want to minimize financing costs, a well‑structured contingency could work.
If you want a clear plan tailored to your timing, equity, and target neighborhood, reach out to Ty Lankheet for a free home valuation and a step‑by‑step purchase strategy.
FAQs
What is a bridge loan when buying in Beaverton?
- A bridge loan is short‑term financing that lets you buy your next home before selling your current one, often with interest‑only payments and higher rates than a first mortgage.
How does a home‑sale contingency work in Oregon?
- A home‑sale contingency makes your purchase dependent on selling your current home within an agreed period, with clear deadlines and seller rights to accept backup offers.
Which is cheaper in Beaverton: bridge loan or contingency?
- A contingency usually has lower direct costs, while a bridge loan has fees and interest; the better value depends on how competitive the market is and how long you would carry the bridge.
What if I have limited equity for a bridge loan?
- Bridge lenders typically require substantial equity; if you are short, consider a HELOC, strengthening a contingency, or selling first and renting briefly.
How do sellers view contingencies in competitive markets?
- In faster markets, sellers often prefer non‑contingent offers or require stronger terms from contingent buyers, such as larger earnest money or shorter deadlines.
