Bridge Loan or HELOC? Timing a Move in Kensington

Thinking about buying in Kensington or Silver Spring before your current home sells? You are not alone. In a competitive, higher-cost market, timing your sale and purchase is often the toughest part of the move. This guide breaks down whether a bridge loan or a HELOC fits your plan, what timelines to expect, and which local rules and costs you should model. Let’s dive in.

Bridge loan vs. HELOC basics

Bridge loan: how it works

A bridge loan is short-term financing that helps you buy your next home before your current one sells. It is typically secured by your existing home and paid off when that home closes or you refinance. Consumer guides note these loans carry higher rates and fees than a standard mortgage and usually require strong equity and credit. Expect interest-only payments with a payoff at sale or maturity. NerdWallet explains common bridge loan features.

Funding can be fast. Some specialty lenders close in days, while banks often take several weeks. Speed usually comes at a higher cost. See CNBC Select on typical bridge loan timelines and ConsumerAffairs on key risks, including carrying two payments.

HELOC: how it works

A home equity line of credit (HELOC) lets you draw funds from your existing home’s equity during a draw period, often with interest-only payments on what you use. Rates are usually variable, tied to prime plus a margin. In 2025, average HELOC rates have generally been in the mid to high single digits, though offers vary. See Bankrate’s overview of HELOC rates.

Timelines vary by lender. Many HELOCs close in about 2 to 6 weeks, while some digital programs move faster for well-documented borrowers. Learn more about typical timing from Experian’s HELOC timeline guide.

When each option makes sense locally

Choose a bridge loan when

• You need a large, immediate down payment to make a non-contingent offer.
• You expect your Kensington or Silver Spring home to sell quickly based on prep and pricing.
• You value speed and a cleaner offer more than short-term financing cost.

Choose a HELOC when

• You have strong equity and want flexible access to funds for a down payment.
• You can plan a few weeks ahead to open the line before you write offers.
• You prefer generally lower carrying costs and can accept variable-rate risk. For pros and cons, see Bankrate’s HELOC considerations.

Timing strategies that win in Kensington

Sell first, then buy

You avoid carrying two mortgages and can use sale proceeds to fund your purchase. The tradeoff is temporary housing or a gap between closings. A short post-settlement occupancy can help.

Buy first with bridge funds or a HELOC

Your offer is stronger without a home sale contingency. You lock the next home, then sell. The tradeoff is higher short-term cost and the risk of timing slipping. NerdWallet’s bridge loan primer covers the fundamentals.

Make a contingent offer

This reduces your risk but can be less competitive in popular neighborhoods. You can tighten timelines and show your current home is ready for market to strengthen your case.

Use a post-settlement rent-back

A rent-back lets sellers remain in the home briefly after closing, which can reduce double moves. Learn the basics from Rocket Mortgage’s overview of rent-back agreements. Keep lender rules in mind. Many conventional loans limit rent-backs to about 60 days, and credits from rent-backs have restrictions. See Fannie Mae’s rent-related credits guidance.

Model local costs and rules in Montgomery County

• Recordation tax tiers: Montgomery County adopted higher, tiered recordation taxes for higher price brackets effective October 1, 2023. These can meaningfully affect closing costs and net proceeds at Kensington price points. Review the county’s summary and confirm exact figures with your title company: Montgomery County Bill 17-23.
• State and county transfer fees: Maryland has state transfer tax and county transfer and recordation taxes. Some exemptions may apply in limited situations. Your title team can provide precise line items.

How to choose with confidence

• Prioritize speed or cost. If you must close fast to win a home, a bridge loan can help. If you have time to prepare, a HELOC is often cheaper to carry.
• Protect your downside. Plan for a slower sale and budget for two payments if needed. See ConsumerAffairs on bridge loan risks.
• Align your financing with your offer strategy. Non-contingent offers, flexible closing dates, and rent-backs often win in competitive pockets.

Pre-move checklist

• Get a current market valuation and equity estimate for your home.
• Update your purchase preapproval and ask lenders how they treat bridge loans, HELOCs, and rent-backs in underwriting.
• Request written timelines for both options, plus a full fee breakdown and sample payment schedule.
• Build a contingency plan for carrying costs if your sale runs longer than expected.
• Draft rent-back terms early if you plan to request or offer one, and confirm they fit the buyer’s loan program. See Fannie Mae’s guidance on rent-related credits.

Ready to move in Kensington or Silver Spring?

You deserve a plan that fits your timing, budget, and comfort level. With more than two decades in Montgomery County and a team-backed marketing platform, Michelle will help you compare scenarios, prep your home to sell, and structure a winning offer on your next one. Connect with Michelle Milton to map your move.

FAQs

What is the main difference between a bridge loan and a HELOC?

• A bridge loan is short-term, higher-cost financing meant to fund a purchase before your sale closes. A HELOC is a revolving line of credit with variable rates that you can draw as needed.

How long does it take to get a HELOC in Maryland?

• Many lenders close HELOCs in about 2 to 6 weeks, though some digital programs can be faster for well-documented borrowers, according to Experian.

How fast can a bridge loan fund for a Kensington purchase?

• Some specialty lenders can fund in days, while bank programs may take several weeks, per CNBC Select’s overview.

What local closing costs should I model in Montgomery County?

• Include Maryland transfer tax and county recordation and transfer taxes, and note that Montgomery County uses tiered recordation rates for higher price points per Bill 17-23.

Are rent-backs allowed if I finance my Kensington purchase?

• Often yes, but many conventional loans limit seller rent-backs to about 60 days and restrict how rent-back credits are treated, according to Fannie Mae.