bridging loan


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Bridge Loan

A loan for a short-term period, usually two weeks to three years, until long-term financing can be arranged or an obligation is removed. Interest rates are relatively high, often 12-15%. Bridge loans are used to satisfy working capital needs; for example, if a company is arranging for an IPO or a bond issue in the coming months, but needs capital before then, it may take out a bridge loan. In doing so, it will plan to pay back the bridge loan with the money raised in the longer-term financing.

bridging loan

a form of short-term LOAN that is used by a borrower as a continuing source of funds to ‘bridge’ the period until the borrower obtains a medium or long-term loan to replace it. Bridging loans are used in particular in the housing market to finance the purchase of a new house while arranging long-term MORTGAGE finance and awaiting the proceeds from the sale of any existing property.

bridging loan

a form of short-term LOAN used by a borrower as a continuing source of funds to ‘bridge’ the period until the borrower obtains a medium- or long-term loan to replace it. Bridging loans are used in particular in the housing market to finance the purchase of a new house while arranging long-term MORTGAGE finance and awaiting the proceeds from the sale of any existing property.
References in periodicals archive ?
A bridging loan carries a number of characteristics
Gross advances in the bridging loan sector will reach [pounds sterling]5.
Few major high street lenders operate in the bridging loan industry
com/reports/c46089) has announced the addition of UK Bridging Loans 2006 to their offering.