Bridge Loans — Short-Term Financing That Moves Fast
A bridge loan is a short-term loan (6 months to 3 years) that fills the gap between where you are now and your next permanent financing. Use it to buy before you sell, rehab a distressed property, or close on a time-sensitive deal before long-term financing is in place.
Bridge Loan Highlights
- Terms: 6 months to 36 months
- Up to 80% LTV on current value
- Up to 70% of ARV on rehab/value-add deals
- No income documentation on most programs
- Close in 5–14 business days
- Interest-only payments
- Residential and commercial properties eligible
- Loan amounts from $100,000 to $10M+
- No prepayment penalty after minimum hold period (varies by program)
When to Use a Bridge Loan
Buy Before You Sell
Found your next investment before your current property sells. Bridge covers the purchase while you market the existing property.
Rehab to DSCR
Distressed property won’t qualify for DSCR yet. Bridge through the renovation, then refi to a 30-year DSCR loan once it’s stabilized and rented.
Time-Sensitive Deals
Auction, foreclosure, or off-market deal with a 10-day close requirement. Bridge loans close in days, not months.
Stabilization Play
Property is vacant or under-rented. Bridge while you lease it up, then qualify on actual rental income at refi.
Bridge vs. Hard Money — What’s the Difference?
Bridge loans and hard money are similar but have distinct uses. Bridge loans are typically for cleaner assets that need short-term gap financing — stable properties, experienced investors, clear exit strategy. Hard money is more flexible on property condition and borrower credit but usually carries higher rates. We offer both — we’ll match you to the right program based on your deal.
Bridge Loan Terms
| Loan Feature | Typical Terms |
|---|---|
| Loan term | 6 months to 36 months |
| LTV (stabilized property) | Up to 75–80% of current value |
| LTV (value-add / rehab) | Up to 70% of ARV |
| Interest rate | 9% – 12% (interest-only) |
| Points | 1–3 at origination |
| Minimum loan | $100,000 |
| Maximum loan | $10M+ (case by case) |
| Close time | 5–14 business days |
| Income documentation | Not required on most programs |
| Property types | SFR, 2–4 unit, multifamily, commercial, mixed-use |
The Bridge-to-DSCR Strategy
One of the most effective exit strategies for bridge loans is the BRRRR method: Buy, Rehab, Rent, Refinance, Repeat. Here’s how it works with a bridge loan:
- Buy distressed using a bridge loan (closes in days, no income docs)
- Renovate — the bridge loan funds the purchase and covers holding costs
- Rent — place a tenant at market rent
- Refinance into a 30-year DSCR loan at the new appraised value
- Cash out your equity and repeat with the next deal
Example: Buy a $180,000 distressed property with a $170,000 bridge loan. Put $40,000 into renovation. Property now appraises at $280,000 and rents for $2,200/mo. DSCR refi at 75% LTV pulls $210,000 — enough to pay off the bridge and pull $40,000 cash out.
Who Qualifies for a Bridge Loan
- Real estate investors — experienced and first-time welcome
- Flippers needing fast close and rehab flexibility
- Landlords growing their portfolio without conventional income limits
- Commercial buyers closing ahead of SBA or conventional approval
- Foreign nationals investing in U.S. real estate
- Borrowers with credit issues — some programs from 580 FICO
Bridge Loan Exit Strategies
Every bridge loan needs a clear exit before we fund. Common exits include:
- Sell the property — close the bridge with sale proceeds
- Refinance to DSCR — most common for rental investors
- Refinance to conventional — if property and borrower qualify
- Sale of another asset — sell existing property to pay down bridge
- Commercial perm loan — for commercial or multifamily exits
Bridge Loan FAQ
Can I use a bridge loan to buy at auction?
Yes — bridge loans are ideal for auction purchases. Most auctions require closing in 10–30 days with no financing contingency. We can commit in 48 hours and close in 5–10 business days on clean deals. You’ll need to have the deal under review before the auction date.
What’s the minimum and maximum loan size?
We fund bridge loans from $100,000 on the low end and $10M+ on the high end. For deals above $5M, additional documentation and underwriting time may be required. There’s no hard ceiling — large portfolio deals and commercial bridge loans are evaluated case by case.
Do bridge loans have prepayment penalties?
Most programs have a minimum interest period (typically 3–6 months) — meaning you’ll owe interest for those months even if you pay off early. After the minimum period, most bridge loans can be paid off without penalty. We’ll spell this out clearly at origination.
Can I extend a bridge loan if I need more time?
Yes, extensions are available in most cases for a small fee (typically 0.5–1 point). If you’re in good standing and making progress toward your exit, we want to work with you. Extensions are granted on a case-by-case basis — reach out before the maturity date, not after.
What LTV can I get on a value-add or distressed property?
For value-add properties, we lend based on ARV (after-repair value) rather than current as-is value. Typical programs allow up to 70% of ARV, meaning your loan is sized against what the property will be worth after improvements — not what it’s worth today in distressed condition.
Ready to bridge your next deal? Apply for a bridge loan today — we close in 5–14 business days.