Bridge Loans

Some companies find they need a relatively short term bridge loan secured by real estate as collateral. The bridge provides immediate liquidity, afterwards the bridge loan is replaced by permanent financing at the end of the bridge loan term.

Bridge loans secured by real estate are usually “hard money loans.” Hard money bridge loans offer lower loan to value percentages, and focus exclusively upon the collateral value of the real estate securing the hard money loan. Since the LTV ratios are lower with hard money bridge financing than with conventional real estate loans, the hard money lender can dispense with the requirement for debt service coverage and cash flow analysis of the borrower that would be required with conventional real estate financing.