Finding a Good Commercial Bridge Loan – Answers to 3 Common Questions

Commercial Bridge LoansAs a business owner, you are certainly not alone in thinking that your Company may need alternate forms of financing to help you maintain or expand your business. Many companies are in the same position while they try to obtain a loan from banks or other financial institutions.  A commercial bridge loan may be perfect for “bridging” the gap in your finances while you’re in the process of obtaining conventional permanent financing. Here are 3 commonly asked questions about commercial bridge loans and whether or not they can help you achieve your business objectives.

1. What are commercial bridge loans?

A commercial bridge loan is a short-term loan that is used to bridge the gap between various financial expectations–to get your company from point A to B within the most time-efficient and cost effective manner.

2. What is the difference between a commercial bridge loan and commercial hard money loan?

Both commercial hard money loans and bridge loans both use the property as a collateral asset, but the main difference between the two is that hard money loans are made only by private investors. This kind of loan typically has a higher interest rate than a bridge loan would and generally are used in cases where a company may be facing impending financial problems like balloon payments coming due or in cases where Principal Borrowers require extreme speed of funding like with auction purchases–where the opportunity cost of missing out on a great deal far exceeds high but short-term hard money loan interest rates.

3. When should I not get a commercial bridge loan?

When your Company requires interim financing on a property while you seek long-term commercial real estate financing, you might consider a bridge loan. There are large risks in this kind of investment but also high rewards associated as well. But you should seek alternative financing if you can’t find long-term financing or pay the extra cost of interest on the loan. However…

When prospective Clients call us seeking a commercial bridge loan, the first question we usually ask is “have you already approached your local bank?” We ask this because our job begins when your bank either says “no” for various reasons or they can’t fund you within your tight time-frame.  If you qualify for bank financing and you have plenty of time to get your project funded, you probably don’t need a bridge loan.

Bridge loans are a great way to practically guarantee your ability to purchase a property. Your battle isn’t over with a bridge loan and you still want to eventually obtain long-term, traditional financing as soon as it’s feasible, but whether you need to expand your Company’s business or survive a current crisis, a commercial bridge loan can help you weather the storm and achieve your business objectives in a timely and cost-effective manner. So, when your bank won’t lend you the money or they can’t process your loan fast enough, just call us and we’ll help you obtain the best commercial bridge loan you qualify for as fast as humanly possible. Deal?

We hope you’ve found this information useful.  Feel free to share your thoughts, questions, and concerns in the Comment / Reply area below. Thanks & see you @ the Closing Table!

Tags: ,

Leave a Comment