Bridge Loan

Commercial Rehab Loans specialists including commercial construction loans for most commercial property types, starting at $500,000. LTVs to 65%, and up to 80% in some cases. Seller seconds OK.

Ask for Woodson @ 646-693-7799

For commercial real estate rehab loans, let Blackstone Financial Services help your company acquire bridge financing to rehab your current property or proposed Property. We understand the frustrations of business property owners and offer short and longer term bridge loan financing for your commercial rehabilitation and construction. Many of our commercial rehab loans are bridge loans to learn what is a bridge loan and how do bridge loans work, see below.
What is a Bridge Loan?
Very simply, a commercial bridge loan is a short term loan (usually no more than 3 years) to give the borrower time to stabilize the property or their financial/credit situation in order to either 1) Refinance the commercial property or 2) Sell the property. Unlike our bridge mortgage loan program, most commercial bridge financing loans carry double-digit interest rates and significant front end points. We hope this helps you understand what is a bridge loan at least for commercial properties.

How do Bridge Loans Work? Commercial bridge loans “bridge” the gap until the borrower can get conventional commercial financing. They serve a very important role in commercial real estate due to the limitations of traditional bank (including SBA) loan programs.

$500,000 to $15,000,000 or more for loans on commercial property rehabs

We represent traditional hard money commercial bridge lenders but have refocused our efforts on the commercial rehab loans and commercial construction loans areas of commercial real estate. Call to learn more. You’ll be amazed the projects we can help you with.
We specialize in lending for property acquisitions and refinance. Our creative lending expertise enables us to close on these equity-based programs of $300,000 to $15,000,000. They also allow borrowers with assets to acquire the financing they need.

1. Do your commercial rehab loans work when someone buys a commercial property where the seller is giving a second? In most cases we will want to see a max of 65% “As Is” LTV including the seller second.

2. What if I need to get a commercial bridge loan with bad or poor credit? Credit is not normally a factor in our commercial bridge mortgage financing programs.

3. Do you have commercial construction loans for residential developments? Yes but on a case by case depending mostly on the phase of the development. We do not finance construction soft costs.

Not only are banks not lending much on corporate properties, since late 2006, 384 lenders have gone under. So just how does the process of getting short term financing work?

The process starts with a few simple questions for us to understand the type of property, the value of their property(s), the bridge amount and the customer’s needs. Credit may or may not be pulled as it’s not much of a factor in these bridge loans. For qualifying properties and LTVs (see above) that have a recent appraisal, the process may be quite fast. Commitments can happen in as little as a few hours and funding can occur in as little as 5 days. Fees can be built right into the loan which typically goes for 1 to 3 years. Also, there are no prepayment penalties so you can pay off the loan at any time, giving you the flexibility you need when seeking longer term financing. We’ve had customers pay off their bridge financing in as little as 3 months. Our programs are ideal for property owners needing to move quickly. This may help a business out of a jam when their existing loan hits the balloon date. Our programs can also allow a business person the ability to take advantage of a great opportunity in buying a piece of property in a distressed situation. The key to these is the speed of issuing these loans.

Below is an article from you may find of interest.

How Beneficial is Bridge Loan Financing?
A commercial bridge mortgage loan financing facilitate someone who has not yet sold their previous or old property to be able to purchase a new one. The person uses equity from the existing property as a down payment for the new one before they have acquired the equity. Moving from an old home is time pressured since the closing date requires you to have vacated the premises. It provides temporary financing before the person gets a more permanent or long term financing solution. The loan has various benefits as well as drawbacks that an applicant should weigh out before taking the loan.

The major benefit of bridge loan financing is the short term nature of the loans. The loans are designed to be paid fully before a person gets to secure long term funding. This reduces the risk getting into a financial hump and losing the ability to pay back. Long term loans are stretched over a long period and the borrower may suffer financial problems. Deferring from making payments eventually lead to penalty fees and the borrower has to pay a larger amount than originally planned. Some end up getting into more debt so as to clear previous debt which may not help eventually.
The short term nature allows borrowers to clear their debt before they get into financial huddles or take on other loans. The bridge loan financing also provides borrowers with ability to choose their repayment option. Since it a loan provided before one secures a permanent financing solution there can be two options. The borrower can choose to repay the loan before they secure a long term financing solution. They can also choose to repay it after they secure the long term finance. A borrower is therefore able to weigh their options and choose the best and most suitable method for themselves.
On the downside bridge loans are short term meaning they have to be repaid in a shorter time period. This may a financial problem to the borrower. This may also mean large payments that the borrower may be unable to afford. Choosing to repay the loan after acquiring long term financing may not be good as the loan earns interest the longer it is not repaid. Bridge loan financing is a bridge before permanent financing is acquired. Such expectations may fall through leaving the borrower stranded. The situation is worse if the long term financing was intended to repay the bridge loan.

Interesting Financing Tips Article
Here are 5 Financing Tips You Need To Know

For many corporate property(s) owners or buyers, the banks are pretty much ignoring their needs. And why not? These may be really cheap (near zero interest rate) money from the Federal Reserve that they can buy U.S. Treasuries and pocket a nice spread with no risk.
The effect of this is a huge number of businesses are having to get short terms financing on their businesses properties to tide them over a few years until corporate credit is freed up or until they sell their properties. And while they are not cheap, they may mean the difference in hanging on to their properties and losing it. However, there are some conditions for borrowing that a prospective borrower needs to be wary of. Here are 5 critical watch outs you need to be aware of.

1. Prepayment penalties – Businesses needs to try and avoid borrowing with a prepayment penalty as just like with the sub prime implosion, those penalties can wreak havoc with your future refinance or sales plans. Not having a prepayment penalty gives you a lot more flexibility.

2. Term – Businesses need to be sure the term is long enough to carry them to the next phase whether it be a refinance or sale. Too short can get you right back into hot water. If you avoid a prepayment penalty, there is no downside to a longer than needed term as kind of insurance.

3. Not Borrowing Enough– You need to be sure you borrow enough to cover those little (or big) surprises. Again as in number two above, it’s just good insurance particularly in these uncertain economic times.

4. Borrowing too much – Yes, I know I just warned against borrowing too little but you can easily go overboard and borrow considerably more than you need. If you’re buying or constructing a business property(s), it’s real easy to borrow enough to cover all those “bells and whistles” that are best done from your businesses future cash flow.

5. Not Using the Best Finance Structure – Commercial bridge mortgage loans can be structured many ways. Be sure that you don’t just take the first structure that is presented to you by the lender. Be creative. You may want an experienced third party to help you figure what structure is best for you and your business(s).

Short-term (usually one to three months) loan advanced to cover the period between the termination of one loan and the start of another. It is arranged generally to complete a purchase (such as a new house) before the borrower receives payment from a sale (of the old house), or before a long-term loan is made available upon fulfillment of its requirements (such as commissioning of a facility or a plant). Also called bridge finance, bridging loan, or gap financing.