Finance the work between purchase and stabilization
- 1Acquire / refinanceInitial advance
- 2ImproveBudget + future funding
- 3LeaseCash flow develops
- 4RepaySale or permanent loan
Illustrative sequence. The planned exit depends on property performance and financing availability.
When a bridge loan fits
Bridge financing can fund a purchase, renovations or a refinance while a property is being repositioned. The business plan needs a credible path to repayment through a sale, permanent financing or another identified source.
How much can the property support?
Lenders assess the current property value, project cost, existing cash flow and expected income when the work is complete. The proposed exit is part of the underwriting. Higher projected rents do not automatically produce higher proceeds.
The terms to compare
Review the initial advance, future funding, interest reserve, recourse, extension requirements and repayment provisions together. For a floating-rate loan, check the benchmark definition, spread, floor and any required rate cap. Fees and extension costs belong in the comparison as well.
Renovation funding and extensions
Determine when renovation funds are available, what documentation is required for each draw and whether the borrower must advance cash first. An extension may require a fee, a new cap, a paydown or operating tests. Model those requirements before relying on it.
Plan the refinance before signing
Work backward from the intended permanent loan or sale. Allow for construction delays, lease-up and the operating history the next lender may require. We compare financing proposals against that plan.
What to send us
A property address, purchase price or current loan balance, rent roll, operating statements, renovation budget and expected timeline. Send the materials you have and we will identify the remaining questions.
How we arrange financing · Compare term sheets · Documents lenders request
A renovation loan needs a funding plan as well as an exit
Consider a property with vacant units and a renovation budget. The borrower needs to know how much is available at closing, how later advances are released and who pays while work is underway. A proposal with more total proceeds can still leave a cash shortfall if reimbursement comes after contractors must be paid.
We work through the timing of advances, leasing and debt service alongside the proposed permanent loan or sale. That gives the lender a financing request it can evaluate and gives the owner a clearer view of the cash needed between closing and stabilization.