That bridge loan on my duplex nearly sank me last month

I took out a 6 month bridge loan on a duplex in Austin back in January to cover the gap between selling my old place and buying this new one. The rate was 9.5% and I thought I had plenty of time, but the buyer for my old house backed out on day 90. By the time I found a new buyer and closed, I was 10 days past the maturity date and they hit me with a 2% extension fee on the whole balance. Anyone else get trapped by a tight bridge loan timeline?

2 comments

2 Comments

dixon.spencer1mo ago

Oh man, did the same thing happen with the extension fee hitting you out of nowhere? Those 2% fees are brutal, I got hit with a 1.5% one on a $400k balance and it pretty much wiped out all my profit. One thing I learned the hard way is to always build in a 30 day buffer when you estimate closing dates, especially with buyer financing falling through so often these days. Also, next time see if your lender will let you lock in a 9 month term instead of 6 months, the rate might be a tiny bit higher but it saved my bacon on a deal last year.

briancarter1mo ago

Doesn't it feel like finance penalties are just the modern version of fine print that nobody reads anymore? It's like you have to WATCH for hidden fees everywhere you look these days.