Bridge Loans

We offer bridge loans to owners, investors, and developers who need time to make improvements, find a new tenant, or sell a property. Our extensive experience and streamlined processing help ensure fast and smooth closings.

Free Consultation – No Obligation

Bridge Loans

What Is a Bridge Loan?

A commercial bridge loan helps you to cross the monetary gap when you are between large business transactions. They are intended for situations in which you know you can repay the loan within a short amount of time, typically within months.

In the context of commercial real estate, bridge loans become especially valuable when a time-sensitive opportunity arises. For example, a company might identify a prime location for expansion but they have not yet sold its current property. In such cases, commercial bridge loans provide immediate funding to seize the opportunity without missing out on the potentially lucrative deal due to timing constraints.

How does a Bridge Loan Work?

Commercial bridge loans are typically secured loans, meaning that you’ll need to put up collateral (preferably the commercial property you’re buying or renovating) in order to be approved for such a loan.

The loan amount you’re offered will usually be a certain percentage of the value of the collateral – which is known as the loan-to-value (or LTV) ratio. Most commercial bridge loans have an LTV ratio of about 65% to 80%.

Since the commercial bridge loan is linked to the value of the collateral you offer, lenders are often lenient about other traditional loan requirements, such as your credit score and payment history. But the interest rate for a commercial bridge loan will almost always be significantly higher than a traditional business loan.

How Can I Use My Bridge Loan?

A typical example might be when you are selling one property after you have purchased another. You are likely to obtain the money you need after your initial property sells, but you need some financial help in the meantime.

A business owner might use a bridge loan and quickly seize the opportunity to buy a distressed commercial property at a discounted price. They could then refinance the commercial bridge loan for a conventional commercial mortgage a few months down the line.

While this is a common use of bridge loans, you could also use such a loan to acquire a new business or buy an expensive piece of equipment.

The only requirement is that you should provide collateral for the loan and should refinance to a more conventional financing option down the line.

How Can I Qualify For a Bridge Loan?

Depending on the bridge loan you may be required to have anywhere from 0-15% liquidity relative to the committed loan amount.

Your story matters. Specifically, have to done this type of commercial project previously.

While not a main requirement, a FICO score of 680+ will offer you better terms.

What Are The Advantages of a Bridge Loan?

Fast: The main advantage of bridge loans is their ability to provide quick access to capital. Traditional mortgage processes can be time-consuming, and securing a long-term financing option might take several weeks or even months. However, with a bridge loan, you can swiftly obtain the funds you need to initiate the purchase of the new property, allowing you to move forward with your plans immediately.

Accessible: If you (or your company) have a poor credit score, then a commercial bridge loan might be your best financing option. Our loans are granted more on the basis of the value and viability of the property being bought (collateral) than the borrower’s creditworthiness.

Customization: Our providers often provide customized loan structures for borrowers seeking commercial bridge loans. This might include low monthly payments, an expedited approval process, and competitive interest rates. 

What Are The Disadvantages of  a Bridge Loan?

Risk: If you purchase a piece of commercial real estate with a bridge loan, you’ll have to put that property up as collateral. This would put the entire investment at risk in case of a default. A short-term bridge loan could also be risky due to market fluctuations and unexpected delays in construction – which might hinder the successful repayment of the loan.

Interest Rates: As commercial bridge loans are considered riskier (and don’t place much importance on credit scores), they generally come with significantly higher interest rates compared to traditional business loans. This could place an additional burden on you, making it harder to pay back the loan on time.

Short Duration: Commercial bridge loans have a short repayment schedule, seldom exceeding two years. This could put pressure on you to quickly secure long-term financing or sell the property before the repayment period comes to an end, which may not yield the best ROI for the business.

Pros

Cons

How Do I Apply for a Bridge Loan?

Will need to prepare an executive summary to present to our providers, essentially a resume, describing your project and your previous experience with similar projects.

Some documents we may require are:

  • Most Recent Two Months Bank Statements (Borrower & Guarantors)
  • Most Recent Two Years Tax Returns (Borrower & Guarantors)
  • Borrower Entity Documents and Appropriate Business
    Licenses
    • Legal Filing Documents
    • Operating Agreement & Certificate of Formation (LLC)
    • Articles of Incorporation & Bylaws (Corporation)

What If I am Declined for a Bridge Loan?

You'd be amazed at the inventiveness of the lenders we work with. Tell us you story, your needs and your timeframe and we'll find an acceptable commercial real estate loan to reach your goal.

What Is a Bridge Loan?

A commercial bridge loan helps you to cross the monetary gap when you are between large business transactions. They are intended for situations in which you know you can repay the loan within a short amount of time, typically within months.

 

In the context of commercial real estate, bridge loans become especially valuable when a time-sensitive opportunity arises. For example, a company might identify a prime location for expansion but they have not yet sold its current property. In such cases, commercial bridge loans provide immediate funding to seize the opportunity without missing out on the potentially lucrative deal due to timing constraints.

How Does a Bridge Loan Work?

Commercial bridge loans are typically secured loans, meaning that you’ll need to put up collateral (preferably the commercial property you’re buying or renovating) in order to be approved for such a loan.

 

The loan amount you’re offered will usually be a certain percentage of the value of the collateral – which is known as the loan-to-value (or LTV) ratio. Most commercial bridge loans have an LTV ratio of about 65% to 80%.

 

Since the commercial bridge loan is linked to the value of the collateral you offer, lenders are often lenient about other traditional loan requirements, such as your credit score and payment history. But the interest rate for a commercial bridge loan will almost always be significantly higher than a traditional business loan.

How Can I Use My Bridge Loan?

A typical example might be when you are selling one property after you have purchased another. You are likely to obtain the money you need after your initial property sells, but you need some financial help in the meantime.

 

A business owner might use a bridge loan and quickly seize the opportunity to buy a distressed commercial property at a discounted price. They could then refinance the commercial bridge loan for a conventional commercial mortgage a few months down the line.

 

While this is a common use of bridge loans, you could also use such a loan to acquire a new business or buy an expensive piece of equipment.

 

The only requirement is that you should provide collateral for the loan and should refinance to a more conventional financing option down the line.

How Can I Qualify For a Bridge Loan?

Depending on the bridge loan you may be required to have anywhere from 0-15% liquidity relative to the committed loan amount.

 

Your story matters. Specifically, have to done this type of commercial project previously.

 

While not a main requirement, a FICO score of 680+ will offer you better terms.

What Are The Advantages of a Bridge Loan?

Fast: The main advantage of bridge loans is their ability to provide quick access to capital. Traditional mortgage processes can be time-consuming, and securing a long-term financing option might take several weeks or even months. However, with a bridge loan, you can swiftly obtain the funds you need to initiate the purchase of the new property, allowing you to move forward with your plans immediately.

 

Accessible: If you (or your company) have a poor credit score, then a commercial bridge loan might be your best financing option. Our loans are granted more on the basis of the value and viability of the property being bought (collateral) than the borrower’s creditworthiness.

 

Customization: Our providers often provide customized loan structures for borrowers seeking commercial bridge loans. This might include low monthly payments, an expedited approval process, and competitive interest rates.

What Are The Disadvantages of a Bridge Loan?

Risk: If you purchase a piece of commercial real estate with a bridge loan, you’ll have to put that property up as collateral. This would put the entire investment at risk in case of a default. A short-term bridge loan could also be risky due to market fluctuations and unexpected delays in construction – which might hinder the successful repayment of the loan.

 

Interest Rates: As commercial bridge loans are considered riskier (and don’t place much importance on credit scores), they generally come with significantly higher interest rates compared to traditional business loans. This could place an additional burden on you, making it harder to pay back the loan on time.

 

Short Duration: Commercial bridge loans have a short repayment schedule, seldom exceeding two years. This could put pressure on you to quickly secure long-term financing or sell the property before the repayment period comes to an end, which may not yield the best ROI for the business.

Pros and Cons of Bridge Loans

Pros

Cons

How Do I Apply for a Bridge Loan?

Will need to prepare an executive summary to present to our providers, essentially a resume, describing your project and your previous experience with similar projects.

Some documents we may require are:
  • Most Recent Two Months Bank Statements (Borrower & Guarantors)
  • Most Recent Two Years Tax Returns (Borrower & Guarantors)
  • Borrower Entity Documents and Appropriate Business Licenses
    • Legal Filing Documents
    • Operating Agreement & Certificate of Formation (LLC)
    • Articles of Incorporation & Bylaws (Corporation)

What If I am Declined for a Bridge Loan?

You’d be amazed at the inventiveness of the lenders we work with. Tell us you story, your needs and your timeframe and we’ll find an acceptable commercial real estate loan to reach your goal.

Bridge Loan Amount, Rate, Term and Time to Fund

Frequently Asked Questions

How do Bridge Loans compare to other Commercial Real Estate Loan Options?

Financing TypeFinancing AmountRateTermTime to Fund
Bridge Loan$500k – $20M10.25% – 15.25%12 months – 3 years2- 4 weeks
CMBS Loan$2M – $100M7.09% – 8.94%5-, 7-, 10-year fixed (25/30 year amortization)30 – 45 days
Construction Loan$50k – $20M10.25% – 11.99%18 months2 – 4 weeks
CPACE Financing$1M – $100M4% – 8%15 – 30 years30 – 45 days
Fix and Flip Loan$50k – $7.5M10.25% – 11.99%12 – 18 months2 – 4 weeks
HUD and FHA Loan$1M – $100M7.18% – 8.125%5-, 7-, 10-year fixed (20 – 30 year amortization)60 – 120 days
Long Term Rental Loan$55k – $5M10.25% – 11.99%5/7/10 year hybrid arms; 30 year amortization2 – 4 weeks
SBA 504 Loan$250k – $5M7.12% – 10.25%10 – 25 years45 – 60 days
USDA Loan$2M – $25M9.75% – 12.5%up to 30 years60 – 90 days
Bridge Loan
Financing Amount$500k – $20M
Rate10.25% – 15.25%
Term12 months – 3 years
Time to Fund2- 4 weeks
CMBS Loan
Financing Amount$2M – $100M
Rate7.09% – 8.94%
Term5-, 7-, 10-year fixed (25/30 year amortization)
Time to Fund30 – 45 days
Construction Loan
Financing Amount$50k – $20M
Rate10.25% – 11.99%
Term18 months
Time to Fund2 – 4 weeks
CPACE Financing
Financing Amount$1M – $100M
Rate4% – 8%
Term15 – 30 years
Time to Fund30 – 45 days
Fix and Flip Loan
Financing Amount$50k – $7.5M
Rate10.25% – 11.99%
Term12 – 18 months
Time to Fund2 – 4 weeks
HUD and FHA Loan
Financing Amount$1M – $100M
Rate7.18% – 8.125%
Term5-, 7-, 10-year fixed (20 – 30 year amortization)
Time to Fund60 – 120 days
Long Term Rental Loan
Financing Amount$55k – $5M
Rate10.25% – 11.99%
Term5/7/10 year hybrid arms; 30 year amortization
Time to Fund2 – 4 weeks
SBA 504 Loan
Financing Amount$250k – $5M
Rate7.12% – 10.25%
Term10 – 25 years
Time to Fund45 – 60 days
USDA Loan
Financing Amount$2M – $25M
Rate9.75% – 12.5%
Termup to 30 years
Time to Fund60 – 90 days

Ready to take the next step and apply for a Bridge Loan?

Free Consultation – No Obligation

Give us a call to see how we can help your business