When to use bridge financing
- Recently-acquired property pending stabilization
- Mid-rehab interim before construction complete
- Lease-up phase before DSCR refinance qualifies
- 1031 exchange replacement property purchase
- Cook County auction or fast-close acquisition
- Cash-out bridge against stabilized investor property
Typical Chicago bridge loan terms
- Loan amount: $50K-$5M
- Rates: 9-12%
- Points: 1-3
- Max LTV: 70-80%
- Term: 3-18 months
- Close: 5-14 days
Frequently Asked Questions
What is a bridge loan?
Short-term financing (typically 3-18 months) covering the gap between purchase and permanent financing. Common uses: recently-acquired stabilization, mid-rehab interim, lease-up phase, 1031 exchange bridge.
How does bridge differ from fix-and-flip?
Mechanically similar. Bridge typically doesn't include rehab escrow; fix-and-flip does. Bridge often funds at higher leverage on stabilized property; fix-and-flip funds rehab work.
What rates are typical?
9.0%-12.0% with 1-3 points. Short terms typically have higher effective cost than longer hard money due to fixed origination.
Can I use a bridge loan to close fast on auction?
Yes — bridge loans are commonly used for Cook County Sheriff's Sale and Tax Sale acquisitions requiring fast close.
What's the typical close speed?
5-14 days. Private money operators close fastest on bridge deals (3-7 days).