bridge 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.

bridge loan

A short-term loan that is taken out until permanent financing can be arranged. Also called swing loan.

bridge loan

A short-term loan intended to bridge the gap between other transactions. (1) Temporary financing obtained at the end of a construction loan period but before permanent financing can be arranged. (2) A loan obtained by a home buyer when the equity from an existing home is necessary to provide the down payment for a new home,but the buyer has been unable to sell his or her old home as of that time (frequently offered by employers who transfer employees to new cities).

Bridge Loan

A short-term loan,usually from a bank,that “bridges”the period between the closing of a home purchase and the closing of a home sale.

To qualify for a bridge loan, the borrower must have a contract to sell the existing house. This is the same as a “swing loan.” See Housing Investment/Buying the Next Home Before the Existing One
Is Sold.

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References in periodicals archive ?
1,500,000 bridge loan secured by a mixed-use property in the East Village neighborhood of Manhattan.
Hirshmark Capital
The small business bridge loan program will help small business owners and communities get back up and running and I encourage all affected business owners to apply today.
United States : Gov. Scott Activates Emergency Bridge Loan Program for Small Businesses Damaged by Hurricane Irma
To address the increased demand, Third Federal has introduced a new a bridge loan to ease the homeowner's burden of a temporary move if their home sells quickly, and the financial burden of carrying two mortgages.
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The company has received a two-month extension of a bridge loan for acquisition of Oriel Resources Ltd.
Mechel Announces Extension to Bridge Loan
Although some banks are in the bridge financing business, bridge loans are more often provided by early investors to help a company manage until the next round of investment.
Navigating the new funding landscape: The money's still there, but you have to look a little harder to find it. Enterprising start-ups share where they got the capital they need to thrive. (Dollars & Sense)
State Treasurer Phil Angelides, a potential future gubernatorial candidate himself, put out a terse statement Tuesday blaming the PUC for the bridge loan reverting to a higher-interest, three-year obligation, although offering the silver lining that the state technically will not be found in default on the old, interim loan, so the state's credit rating, which has been lowered because of the electricity financing woes in recent months, may escape further decline.
ENERGY GRIDLOCK POWER AGENCY FEUDS WILL COST STATE HUNDREDS OF MILLIONS
Some of the most common types of debt financing available to the entrepreneur include demand loans, lines of credit, bridge loans, conditional sales purchases and floor financing.
Lenders favor open, honest applicants
The interest rate on the bridge loan is initially set 3-6 percent above a standard benchmark rate.
Acquisition bridge financing by investment banks
2,450,000 bridge loan secured by a 4-story building in the Park Slope neighborhood of Brooklyn.
Hirshmark Capital LLC

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