By Jason Given · 2026-08-16 · 7 min read
You bought an off-the-plan property 12 to 24 months ago with a 10% deposit. At the time, the plan was straightforward - the property would be built, you would sell your current home, and everything would line up neatly. But that is rarely how it works in practice.
Settlement is now approaching, but your current home has not sold. Maybe you have not listed it yet because the market timing did not feel right. Maybe it is on the market but has not attracted the right buyer. Either way, you need to fund the full settlement amount on the new property - and without finance in place, you have a serious problem.
Without the funds to settle, you risk losing your 10% deposit entirely. Worse, the developer can pursue you for the difference between your contract price and whatever they eventually sell the property for. On a $620,000 apartment, that is $62,000 in deposit at risk - plus potential legal costs if the developer takes action.
This situation is more common than people realise. Construction timelines are unpredictable - delays push settlement dates out by months or even years, throwing off your original plans. Personal circumstances change too. Relationships, jobs, family situations - life does not wait for construction to finish. The result is a timing gap between when the new property needs to settle and when your current home will sell.
A bridging loan is specifically designed for this situation. It lets you own both properties temporarily while you sell the old one. Here is how the process works:
This is where off-the-plan bridging gets more complex than a standard bridging loan. The contract price you agreed to 1 to 2 years ago may not reflect today's market.
Lenders require a current valuation of the completed property - not the original contract price. This valuation determines the loan-to-value ratio (LVR), which directly affects how much the lender will advance and what the bridging loan costs.
If the market has risen since you signed the contract, the valuation may come in higher than your purchase price. That is good news - it means a lower LVR and potentially better lending terms.
If the market has softened, or the development has quality or location issues, the valuation may come in lower than the contract price. This is more common than buyers expect, particularly with apartments in areas where supply has increased significantly since the contract was signed.
A lower valuation means you need more equity from your existing property to cover the gap. In some cases, you may need to contribute additional cash to make the numbers work.
Lendology orders valuations early in the process so there are no surprises at settlement. If the valuation is going to be an issue, we want to know about it with enough time to explore alternatives - not two days before settlement when your options are limited.
The cost of bridging finance for off-the-plan settlement depends on your peak debt - the total amount you owe across both properties during the bridging period.
Peak debt equals your existing mortgage plus the off-the-plan settlement amount. For example: if your existing mortgage is $380,000 and the off-the-plan settlement amount is $620,000, your peak debt is $1,000,000.
At a rate of 7.5%, the monthly interest on $1,000,000 is approximately $6,250. If you sell your current home within 3 months, the total interest cost during the bridging period is approximately $18,750.
That cost needs to be weighed against the alternative. Failing to settle means losing your 10% deposit - $62,000 in this example - plus potential legal action from the developer for any shortfall if they resell the property at a lower price. Bridging finance costs money, but it is significantly cheaper than the alternative.
Do not wait for the settlement notice from the developer. By the time that arrives, you typically have 14 to 21 days to settle - and that is not enough time to arrange bridging finance from scratch.
Start the bridging finance process at least 6 to 8 weeks before your expected settlement date. This gives time for pre-approval, valuation of both properties, formal approval, and any issues that arise along the way.
If you know settlement is approaching in the next 3 to 6 months, talk to Lendology now. Earlier preparation means more options and less pressure. We can get pre-approval in place, order preliminary valuations, and have the bridging structure ready to go well before the developer issues the settlement notice.
Sometimes the numbers do not work for a bridging loan. Equity may be insufficient, serviceability may not stack up, or the valuation gap may be too large. When that happens, other options exist - and Lendology explores every one before concluding anything is impossible.
You will need to fund the settlement from another source. A bridging loan lets you settle on the new property using equity in your current home, then sell your current home during the bridging period. Without bridging, you risk losing your deposit or being forced into a fire sale.
Yes. Lenders offer bridging finance for off-the-plan apartments, houses, and townhouses. The key requirement is a current valuation of the completed property (not the contract price from years ago) and sufficient equity in your existing property. Some lenders are more comfortable with apartments than others - Lendology knows which ones.
This is common with off-the-plan purchases, particularly when the market has softened since you signed the contract. A lower valuation means a higher LVR and potentially higher bridging costs. In some cases, you may need to contribute additional funds. Lendology stress-tests against conservative valuations before you commit.
Start the process at least 6-8 weeks before your expected settlement date. This gives time for pre-approval, valuation of both properties, formal approval, and any issues that arise. Do not wait for the settlement notice - by then it may be too late to arrange finance.
Settlement approaching?
Do not wait. Book a chat now and we will map out your options before the deadline.