Bridge Loan Success: A Retiree’s Downsizing Story from SE DC to Bowie, MD
Bridge Loan Success: A Retiree's Downsizing Story from DC to Bowie, MD
By Josh Brawer - Certified Mortgage Advisor
You spot the perfect home. Single level for easier living, just blocks from your daughter and grandkids. But at 73 and freshly retired, selling your longtime DC property before you buy a new home feels impossible. The market moves fast, and your income is just enough to cover your current bills. Sound familiar? That's the spot Mitchell landed in last month. After 25 years guiding families through DMV moves, I've seen this timing crunch play out more times than I can count.
I wanted to share Mitchell's real journey from his roots in SE Washington, D.C., to his new retirement home in Bowie, Maryland, in the hopes that it can help others realize that “common sense” lending does still exist in the DMV. Along the way, I'll break down how bridge loans work to help you buy your new home in DC, Maryland, and Virginia before selling your current one. If you're a retiree trying to navigate this process, or just equity-rich and cash-tight, this story shows how creative financing turns hurdles into a new home. Let's walk through it.
Over 50 Years in Real Estate | Preparing the Final Move!
Mitchell's story starts simple. In 1970, he began his journey in real estate investment. Here is a snapshot of his current financial position today:
- Primary Home (SE DC): Valued at $875,000 (with a $50k mortgage).
- Investment Property (SE DC): Valued at $550,000 (with a $30k mortgage).
- Total Equity: Over $1.3 million.
- Cash on Hand: $150,000.
- Target Home (Bowie, MD): Priced at $650,000.
Life shifted with retirement. Mitchell and his wife wanted a rambler-style home in Bowie, Maryland, listed at $650,000.
No stairs to climb, and right down the street from their daughter for those easy grandkid visits—it checked every box for a stress-free retirement home.
The challenge? He had $150,000 in cash, but his fixed retirement income was just enough to cover his current bills. To complicate matters, his rental property was vacant while being prepared for sale, so it wasn't generating income.
That Bowie listing hit the market at the worst possible time for Mitchell. In Prince George's County, MD, where homes can sell quickly, waiting meant the risk of possibly losing it. He needed to act, but an offer with a home-sale contingency would not be accepted. Sellers in this DMV market rarely accept those structures, especially in competitive situations. Enter the bridge loan.
The Hurdle: When Big Banks Ghost and Timing Bites
Just so you know, Mitchell tried the straightforward route first. He applied with a large national bank, laying out his equity story and retirement plans. The response? Silence. They ghosted him, like they tend to do when the numbers don’t fit their standard boxes. Freshly retired, his income was much lower than when he was working, and adding a new $650,000 property on top of his existing debt exceeded all written underwriting guidelines.
That's when Mitchell found our video and article on bridge loans. Thankfully, he reached out, and after discussing all the options available in today’s market, it became clear that the bridge loan was the best solution. These short-term loans, typically lasting 6 to 12 months, base approval on your assets and a solid exit plan, not just standard debt-to-income calculations most lenders use. We asked Mitchell about his master plan. How did he see all this shaking out?
Defining the Exit Strategy: Mitchell's Master Plan
- Sell both DC properties, netting over $1.3 million.
- Pay cash for the new $650,000 home in Bowie.
- Eliminate all other small debts.
- Invest the remaining ~$700,000 to be debt-free in retirement.
That plan made a lot of sense to us, and we presented him with several different solutions. Bridge loans make the process of buying before you sell not only feasible, but easy.
Making It Happen: Mitchell's Bridge Loan in Action
With the equity in both homes, Mitchell found himself with quite a few different solutions. He could use a bridge loan on his current primary home to pull enough cash-out to buy the Bowie, MD home in full. He could also use a bridge-purchase loan on the new home with a 20% down payment. After looking at the costs, he chose to use his own cash as the down payment for a bridge-purchase loan, as this saved him several thousand dollars in transaction costs.
Bridge Loan Options for Mitchell's DMV Move
| Option | Description | Cost Impact |
|---|---|---|
| Bridge Refinance | Pull Cash-Out from SE DC Home to pay cash for Bowie, MD | Higher transaction costs and fees |
| Bridge Purchase | Finance 80% on Bowie, MD Home using personal cash | Saves several thousand dollars in fees |
Note: Mitchell chose the bridge-purchase option for cost efficiency, closing in under two weeks at 9.50% interest-only.
His loan approval hinged on his exit strategy. If he sold the investment property quickly, he could pay off the Bowie home right away. But what if he couldn’t sell that investment home, or what if he couldn’t sell his primary due to softness in the SE DC housing market for the price he wanted? We had a solution for that too. He could rent both properties, and that income would allow him to refinance his Bowie home into a more permanent solution, such as a traditional 30-year fixed, conventional loan.
The bridge-purchase loan closed in less than two weeks. The rate was 9.50%, interest only, with two points. If everything goes as planned, he will have this bridge loan paid off in full in 60-90 days. While rates and transaction fees are higher than traditional loans, it provided a necessary solution to make what seemed impossible turn into a reality.
Your Next Move: Bridge Loans That Fit Your DMV Story
Mitchell's shift from SE DC to Bowie shows the power of bridge loans for retirees downsizing in the Baltimore – DC Metro region. They unlock equity for that dream home, skip home-sale contingency stress, and provide purchase loan solutions when standard debt qualifications cannot be met. While it is not a perfect fit for everyone, with quick closing timelines and common-sense underwriting, it can get you into your home when traditional products fall short.
The takeaway? Do not let a dip in income or market rush stall your plans. In DC, Maryland, or Virginia, smart tools like these put you in control.
Unlock Your Home's Equity. Move with Confidence.
Don't let a complex sale slow you down. I'll help you create a custom bridge loan strategy for your move in DC, Maryland, or Virginia.
Schedule Your Free Bridge Loan Consultation
About Josh Brawer
Josh Brawer is a seasoned mortgage advisor lending in the Mid-Atlantic and Northeast regions. With over 25 years of experience, he has helped all types of homeowners, from first-time buyers and move-up families to downsizers, navigate their financing needs. Specializing in complex situations, such as self-employed borrowers, asset-based approvals, and specialty products like bridge loans and DSCR investor financing, Josh prioritizes education and transparency to secure optimal terms without stress.