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FAQS

Frequently Asked Questions

Your Lending Questions, Answered

Have questions about bridge lending and how our process works? Our comprehensive FAQ section provides answers to all your lending concerns.

What is a bridge loan?
A bridge loan is a short-term loan, typically 6–12 months, used to “bridge” the gap between purchasing and securing permanent financing or selling the property. In real estate, it’s commonly used for fix-and-flip projects.
Who are typical borrowers for bridge loans?
Real estate investors, house flippers, and developers who need quick capital to purchase, renovate, or stabilize a property before refinancing or selling it.
How is a bridge loan different from a traditional mortgage?
• Faster closing (often in days vs. weeks)

• Based more on asset value than borrower income

• Shorter term and higher interest rates

• Flexible underwriting

What loan-to-value (LTV) do you offer?
This varies by lender, but most bridge lenders offer:

• Up to 70% of the purchase price (LTV)

• Up to 100% of rehab costs, funded in draws

• Combined loan-to-cost (LTC) or after-repair value (ARV) max around 65–75%

How quickly can you close?
Some bridge lenders can close in as little as 5–10 days, depending on title, appraisal, and borrower responsiveness.
What are typical interest rates and fees?
• Rates: 12% annualized interest (sometimes higher depending on risk)

• Points: 1–3% upfront origination

• Other fees may include underwriting, processing, and legal

What is the typical loan term?
Most bridge loans are 6 to 12 months, with extensions available for a fee.
Do you require a credit check or income verification?
While credit may be checked, bridge lenders focus more on the property’s value and exit strategy. Income documentation is often minimal or not required.
How is the rehab portion of the loan funded?
Funds for renovations are typically held in escrow and released in draws as work is completed and inspected.
What’s the exit strategy?
Borrowers are expected to sell the property or refinance into long-term financing before the loan matures.
Do you lend to entities or individuals?

All bridge loans require the borrower to be a business entity (LLC or corporation), not an individual.

Can I use a bridge loan for a primary residence?

No. Our products require non-owner-occupied investment properties due to regulatory reasons.

Is there a prepayment penalty?

We have a 6 month minimum loan period. Anything earlier has a pre-payment for the full 6 months.

What types of properties do you lend on?

• Single-family homes

• 2–4 unit residential

• Small multifamily

• Mixed-use or commercial (depending on lender focus)

What are the risks for investors in a bridge loan fund?
• Borrower default

• Market downturns affecting property values

• Interest rate changes

• Illiquidity of the investment

What is a bridge loan?
A bridge loan is a short-term loan, typically 6–12 months, used to “bridge” the gap between purchasing and securing permanent financing or selling the property. In real estate, it’s commonly used for fix-and-flip projects.
Who are typical borrowers for bridge loans?
Real estate investors, house flippers, and developers who need quick capital to purchase, renovate, or stabilize a property before refinancing or selling it.
How is a bridge loan different from a traditional mortgage?
• Faster closing (often in days vs. weeks)

• Based more on asset value than borrower income

• Shorter term and higher interest rates

• Flexible underwriting

What loan-to-value (LTV) do you offer?
This varies by lender, but most bridge lenders offer:

• Up to 70% of the purchase price (LTV)

• Up to 100% of rehab costs, funded in draws

• Combined loan-to-cost (LTC) or after-repair value (ARV) max around 65–75%

How quickly can you close?
Some bridge lenders can close in as little as 5–10 days, depending on title, appraisal, and borrower responsiveness.
What are typical interest rates and fees?
• Rates: 12% annualized interest (sometimes higher depending on risk)

• Points: 1–3% upfront origination

• Other fees may include underwriting, processing, and legal

What is the typical loan term?
Most bridge loans are 6 to 12 months, with extensions available for a fee.
Do you require a credit check or income verification?
While credit may be checked, bridge lenders focus more on the property’s value and exit strategy. Income documentation is often minimal or not required.
How is the rehab portion of the loan funded?
Funds for renovations are typically held in escrow and released in draws as work is completed and inspected.
What’s the exit strategy?
Borrowers are expected to sell the property or refinance into long-term financing before the loan matures.
Can I use a bridge loan for a primary residence?

No. Our products require non-owner-occupied investment properties due to regulatory reasons.

Is there a prepayment penalty?

We have a 6 month minimum loan period. Anything earlier has a pre-payment for the full 6 months.

What types of properties do you lend on?
• Single-family homes

• 2–4 unit residential

• Small multifamily

• Mixed-use or commercial (depending on lender focus)

What are the risks for investors in a bridge loan fund?
• Borrower default

• Market downturns affecting property values

• Interest rate changes

• Illiquidity of the investment