- $1.65m
Peak debt
- ~$530k
End debt
- 8 weeks
Sold in
The Borrowers
Adrian and Joanne, homeowners moving within Brisbane. Their home was worth about $1.1m with $250k owing.
The Goal
Buy a $1.35m home before selling, without a double move or a rental in between.
The Problem
Buying first meant carrying both properties for a while. Peak debt of about $1.65m against roughly $2.45m of property (67% LVR) looked unserviceable if treated as a permanent loan.
What The Bank Said
The branch ran the $1.65m peak debt as an ordinary principal and interest loan over the full term. On that test the household couldn't afford it.
What We Did
Nathan, one of our Brisbane mortgage brokers, separated peak debt from end debt and took the file to a lender that assesses a bridging loan on the end debt.
The banks are split on this. Westpac and St George capitalise the bridging interest, so there are no repayments on the bridge while you sell, and they test your income on the end debt only. ANZ and CBA charge interest-only repayments on the whole peak debt every month until the old home sells, and test your income on that peak figure plus a buffer. That's the policy that applied at the time.
Nathan modelled the end debt with the bridging interest capitalised over a 6-month sale window, so serviceability ran on the roughly $550k that would remain.
The Result
Peak facility unconditionally approved. The existing home sold 8 weeks later for $1.12m and the final debt came in at about $530k.
Worked Example
Assumed rates, not the rates on this file: 7.2% on the bridge and 6.0% on the end loan over 30 years.
| While selling | Peak-debt lenders | Capitalising lenders |
|---|---|---|
| Monthly repayment | About $9,900 interest only | About $3,300 on the $550k end debt |
| Paid from income over 8 weeks | About $19,800 | About $6,600 |
| Bridging interest | Paid monthly | About $13k added to the loan, cleared from the sale |
Worked example: peak-debt versus capitalising lenders
Monthly repayment
- Peak-debt lenders
- About $9,900 interest only
- Capitalising lenders
- About $3,300 on the $550k end debt
Paid from income over 8 weeks
- Peak-debt lenders
- About $19,800
- Capitalising lenders
- About $6,600
Bridging interest
- Peak-debt lenders
- Paid monthly
- Capitalising lenders
- About $13k added to the loan, cleared from the sale
That's roughly $6,600 a month less out of the household budget while the old home is on the market. The capitalised interest isn't free: it's paid out of the sale rather than wages. Peak-debt lenders suit households with the income to carry both properties, so the structure has to match the household. More on upgrading your home.
Loan Details
| Detail | Figures |
|---|---|
| Locations | Existing home and new home both in Brisbane, QLD |
| Property | Houses, home to live in |
| New home | $1.35m |
| Existing home | About $1.1m with $250k owing; sold for $1.12m |
| Peak debt | $1.65m, 67% LVR across both homes |
| End debt | About $530k |
| Bridging period | Modelled at 6 months; sold in 8 weeks |
| Timing | Late 2025 |
Loan details
Locations
- Figures
- Existing home and new home both in Brisbane, QLD
Property
- Figures
- Houses, home to live in
New home
- Figures
- $1.35m
Existing home
- Figures
- About $1.1m with $250k owing; sold for $1.12m
Peak debt
- Figures
- $1.65m, 67% LVR across both homes
End debt
- Figures
- About $530k
Bridging period
- Figures
- Modelled at 6 months; sold in 8 weeks
Timing
- Figures
- Late 2025
Rates are the rate at approval on the date shown. They are not current offers.
Buying Before You Sell?
We'll model your bridge on the end debt and show which lenders assess it that way.
Book a free assessmentor call 1300 088 065
Hunter Galloway Finance Pty Ltd T/A Mortgage Broker Brisbane - Hunter Galloway ABN 20 605 252 926. Credit Representative 476903 is authorised under Australian Credit Licence 389328. Your full financial situation would need to be reviewed before any offer or product is accepted.
Client examples are based on real situations. Names and identifying details have been changed.