Bridge Loan

A bridge loan is named after its function: to bridge the gap between an immediate funding need and permanent financing. Because it is not used for long term financing, it is sometimes called an interim loan or interim financing. A bridge loan is a short-term loan.

Real estate investors use bridge loans for home purchase, as having cash on hand to close a deal can, at times, be the only leverage a buyer has in very competitive markets. It is also not uncommon to use a bridge loan for down payments, closing costs, and fees. For an investor who wants to maintain cash position while closing several deals in the span of a few weeks, this is an effective option. Similarly, a construction bridge loan provides investor capital to jumpstart construction and rehab projects.

Overall, a real estate bridge loan works by providing fast capital for investors to close deals, real estate professionals to improve properties, and contractors to fund construction and rehab projects. Typically, because these loans originate from hard money lenders, and not mortgage lenders, a home buyer wouldn’t use this loan to buy a new home or to update an existing home they currently occupy.

How do bridge loans differ from traditional mortgage loans?

Primo Capital is a private lender based in Spokane, Washington. As a private money lender, we differ from traditional lenders because our loan requirements are not subject to federal banking regulations, nor do we have to make our loan offers contingent on credit scores. Since we are an equity loan lender, a bridge loan from Primo Capital is underwritten by the After Repair Value (ARV) of the acquisition or by the value of other properties owned by the borrower.

The advantage of the bridge loan lender system is manifold. For one, it diminishes the barrier to entry for new investors. Bridge loan terms, as equity-based loans, have significant differences to traditional mortgage loans, particularly the fact that these loans do not depend on a borrower’s credit score. For a home equity loan, bad credit is not a huge factor. Furthermore, a bridge loan allows an investor to adapt to always fluctuating market conditions, purchase properties with cash, and fund rehab and construction projects without diminishing cash position.

Who Uses Bridge Loans?

*Developer

• Needs a bridge to span the gap between funding construction on a new rehab project and permanent financing.
• Purchases an apartment complex and requires a bridge loan for renovation and operation while locating renters.
• Investor
  
• Desires leverage to close a deal quickly on a prime real estate opportunity.
• Plans to build a real estate empire, but is new to the industry, and has little cash on hand.
  Bridge Loans for Rental Property
  For landlords and property managers interested in renovating their properties, traditional financing options typically require tenant payment history to secure a loan. Yet, a bridge loan from Primo Capital will be based simply on the ARV of the asset, allowing developers and investors to easily apply for loans and quickly receive cash for real estate projects.
  With no restrictions or limits on the number of assets that can be used to secure bridge loans, you can get a bridge loan for all your property rehab, acquisition, and construction needs.
  Bridge Loan ROI
  By increasing the value of equity in real estate investments quickly and with cash, the real estate bridge loan is in high demand. Upgrade your property, prepare rent- ready product, and attract new renters. Paying off the loan can be done all at once, without penalty, or through a monthly payment plan during the duration of your loan.
  Quick Facts about Primo Capital’s Bridge Loan Program

• Up to 90% Loan-to-Value
• First Draw within 48 Hours of Closing
• Loan amounts: $50,000 – $7,000,000*
• No limit on the number of properties
• Residential, small multi-family, and
  small commercial
• Loans are available to individuals,
  trusts, corporations, and limited
  partnerships
• Property must be non-owner
  occupied*Loan amounts, terms, and
  conditions are negotiable on a case-by-
  case basis.

For real estate investors, a bridge loan from Primo Capital means quick access to cash, transparency throughout the lending process, and a reliable lender for all future projects. With no limits on the number of bridge loans or properties we will finance.

We are your long-term solution to every short-term cash flow problem. Our hard money bridge loans are based on property equity, and we can provide same- day qualification in most cases. Fill out our quick and easy 5-minute online application or call us to begin the process today!