Bridge Loan Overview

In its most basic form, a real estate bridge loan is short-term financing provided to a borrower to allow them to purchase a property before their currently owned property is sold. Bridge loans are short-term loans for real estate transactions which generally require quick funding. A property owner uses a bridge loan to borrow against the equity in their existing property to finance the purchase of a new property. As soon as the new property is acquired, the previous property is sold in order to pay off the bridge loan. Bridge loans can also be utilized in reverse order by obtaining the loan against the new property being purchased and then paying off this loan when the previous property is sold. Investors use bridge loans as “gap financing”. For example “bridge to sale” which enables the investor to repair, remodel or stabilize income to maximize market value. Also “bridge to refinance” to increase value for placing long term financing at the lowest possible rates. Bridge loan financing typically has a term of 12 to 24 months. IGR Mortgage Services is able to provide funding for hard money bridge loans on investment property within a matter of days.