Business & Personal Benefits of Bridge Loans

Sometimes you will find that conventional financing isn’t available when you need help in achieving your personal or business goals. Bridge loans are a  great vehicle for individuals or businesses looking for a timely boost to their cash flow, be it an investor wanting to scoop up a great land deal, a company in the midst of a growth spurt, or a business looking to expand its infrastructure. When it comes to getting a quick infusion of business-boosting cash, a bridge loan is a proven method to move your goals forward.

 

What Are Bridge Loans?

 Bridge loans, also known as swing loans, are a type of short-term money lending agreement that bridges the gap until future longer-term financing can be obtained. When an individual or business takes out a bridge loan, they are usually expecting a payout from either a sale or a business venture in the near future. The bridge loan carries them toward this goal, which they will then use to pay back the loan. Bridge loans are short-term loan situations with terms from 6 months to five years in most cases.

 

Benefits of a Bridge Loan

  • Quick turnaround
  • Less stringent underwriting guidelines
  • Allows your business to grow independent of cash flow restrictions

 

When to Get a Bridge Loan

Let’s say you are a business owner and your marketing campaign goes viral. Now retailers are begging for a huge shipment to feature in stores this spring. When your company is experiencing a business development surge, a bridge loan could be the perfect fit. You are in a position to take your business to the next level. How are you going to get the money to produce a shipment to meet your retailer’s orders?

 

3 Reasons to Get a Bridge Loan

  • Unexpected business growth spurt
  • Buying a new home before selling
  • Project cost vs. cash flow discrepancy

It’s a Cash Flow Band-Aid

Every successful business owner knows that you can’t wait for circumstances to be just right before you move forward; you have to make them right! When an opportunity to expand your business’s income arises, make sure to look into how a bridge loan could be helpful to you before you let a cash flow discrepancy hold you back and dictate your business growth.

 

Learn more about California Private Money Lenders’ lending programs

 

Property Matters-Bridge Loans Can Be the Answer

Bridge loans are an option for individuals or investors looking to acquire new properties. If you are in a position where you want to purchase a home before your previous home sells, your are doing a major remodel and you have solid equity in your home, or you are an investor looking to add a good land deal or potential rental to your portfolio, bridge loans give you the infusion of cash to make the deal happen now


How Bridge Loans Work

Bridge loans are quickly closed and generally underwritten with more of a “what makes sense” approach, with good LTV ratios, ability to repay, and the credit worthiness of the applicant taken into account.  Bridge loans are contingent on the likelihood of your property sale or business venture bringing in the expected funds to pay back the loan within the loan term. The natural risk of this type of agreement makes the interest higher than a conventional lending. But this is balanced by the shorter timeframe that the interest would build—most falling in the 6 month to 5 years range.

 

Bridge Loans: A Smart Tool for Company Growth

Bridge loans are an increasingly popular option for people in a variety of positions of advancement. Whether you are expanding your business, buying a new property; bridge loans are a smart tool for individuals and businesses looking to meet their personal or business goals.

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