What are the most common terms of a commercial real estate bridge loan?


A commercial real estate bridge loan will usually have 80 percent loan-to-cost, 70 percent loan-to-value ratios, and often a portion of the loan will be held back until additional value has been achieved within the bridge loan project - such as reaching specific construction phase, or vacancy level, or certain improvements are finished.

A commercial real estate bridge loan will be extended usually for periods ranging from 1 to 3 years, and extensions are usually possible if need is demonstrated.

Typically, commercial real estate bridge loans will have rates based on a prime rate plus 2 or 3% margin; or on LIBOR with 3 to 4.5% margin. Prepayment penalties do not apply with a commercial real estate bridge loan and contractors are expected to have high level of expertise with commercial real estate properties.

Commercial real estate bridge loan closing costs will be between $5000 and $10,000 for loans under $2,000,000; and could reach $20,000 and more for loans above $2,000,000. Amortization offered is often interest-only.

Mortgage rates hit their lowest since 1955. Ask the home loan experts we recommend Quicken Loans how to take advantage of them.
Was this Mortgage QnA helpful?
Not at all
  • Currently 2.9/5 Stars
  • 1
  • 2
  • 3
  • 4
  • 5
Add to this Answer

Mortgage QnA is not a common forum. We have special rules:

  • Post no questions here. To ask a question, click the Ask a Question link
  • We will not publish answers that include any form of advertising
  • Add your answer only if it will contrubute to the quality of this Mortgage QnA and help future readers
If you have trouble reading the code, click on the code itself to generate a new random code. Verification Code Above:
Bookmark and share this QnA: