When To Use Commercial Bridge Loans
Oct 05, 2016
Have you ever been in a situation where you need quick cash to close a real estate deal? This is where interim financing enters the equation. While traditional commercial banks can’t guarantee fast financing solutions, private lenders, especially bridge loan lenders can. Commercial bridge loans are meant to provide short-term financing for individual, or business owner, looking for an interim solution before their conventional loan gets approved, which can be a protracted process (credit score check, financials, etc.).
All You Need To Know About Commercial Bridge Loans
Commercial bridge loans are intended to be short-term, up to one year. While this makes for quick application and approval, it can also entail a higher interest rate. These types of loans are usually paid back for when the borrower secures a traditional and long-term loan or sells their existing property.
Conversely to any type of traditional mortgage lending, commercial bridge loans are backed by non-financial assets. If you plan on getting a bridge loan to close on a potential real estate investment deal, the property in question acts as collateral for the loan, with loan-to-value ratios generally up to 65%.
In Which Situations Can You Use Commercial Bridge Loans?
Real Estate Investment
You can apply for this loan if you have a commercial property you want to sell and it is delaying and you have your eyes on another property. In this case, bridge loan lenders give you capital that you can use to secure a new project while waiting for the cash to come through while you sell your old one.
Real Estate Development
If you have an important construction that you are working on and you need cash to meet important deadlines, you can approach bridge loan lenders for assistance. Rather than putting your projects to a stop, you can apply for an emergency bridge loan so that you can avoid interruption and delay of the project.
Continuity Of Real Estate Business
Any business venture can be put at risk when the business partner decides to walk off to pursue other interests. In such a case, you can use current real estate assets to apply for a commercial bridge loan to secure the current purchase or refinance before finding a long-term solution.
Why Should You Consider A Bridge Loan For Your Commercial Real Estate Loans?
Invest In Other Commercial Properties
You can leverage the short-term financing benefits of your commercial bridge loan to invest in another property, which gives you additional flexibility in a fast-paced market.
Therefore, commercial bridge loans enable you to do business as usual without compromising your long-term ROI.
Want To Apply For A Commercial Bridge Loan Today?
As a private hard money lender, Riverdale Funding, LLC can help you achieve a commercial real estate investment. We have programs for all borrowers no matter what the credit. Because we are a direct lender we have flexible lending guidelines lending our own money, $250,000 up to $5 million. All you need to get started on a bridge or hard money loan is to fill out a commercial hard money loan application or talk to one of our advisors at 888-368-4983 today!