Example Bridge Loan Terms for Multifamily and Commercial Property
Size: $1Million and up
Term: Typically, 6 months to 2 years (extension options available)
Interest Rates: Vary
Origination Fee: Typically, interest-only
Maximum LTV:
Typically, up to 75% of cost (LTC) capped at 70% of the completed or stabilized value.
Advantages
- Loan amounts are determined by total project cost or completed value and not necessarily on income in-place or the as-is value, although in-place income can help secure better rates/terms.
- Fast closing process
- Capital often available when other portions of the credit market are locked up
Disadvantages
- Loans are short-term and generally need to be replaced inside 24 months