What Is a Commercial Bridge Loan?
A commercial bridge loan is a short-term real estate loan designed to “bridge” the gap between an immediate financing need and a long-term solution. They are typically interest-only, run 12–24 months, and are funded by private lenders or debt funds rather than traditional banks. For a comprehensive overview of all commercial refinancing options, see our complete commercial mortgage refinancing guide.
Bridge loans exist because commercial real estate doesn’t always move on a convenient timeline. A balloon is coming due before your permanent financing is ready. A property needs stabilization before it qualifies for conventional underwriting. A time-sensitive acquisition requires closing in two weeks, not three months. In each case, a bridge loan solves a problem that traditional lending cannot.
Bridge loans are more expensive than permanent financing — rates typically run 8–13% — but for many situations they’re not optional. The cost of a bridge loan is almost always less than the cost of losing a property to foreclosure or a forced sale at maturity.
When Does a Commercial Bridge Loan Make Sense?
Balloon Maturity Is Approaching and Permanent Financing Isn’t Ready
This is the most common use case. Your commercial loan is maturing, your permanent refinancing is taking longer than expected, and you need to pay off the balloon now. A bridge loan buys 12–24 months to complete your permanent financing without triggering a maturity default. See: commercial balloon loans: complete guide.
Your Bank Won’t Renew and You Need Time
When a bank declines renewal, you’re often facing a hard deadline with limited time to arrange permanent financing. A bridge loan pays off the existing lender immediately and gives you a runway to find permanent capital without pressure. Read: what to do when your bank won’t renew your commercial loan.
Property Is in Transition or Not Fully Stabilized
Conventional lenders require stable, documented income — typically 12+ months of occupancy history. If your property recently changed tenants, is undergoing renovation, or is in lease-up, you won’t qualify for permanent financing yet. A bridge loan funds the transition period until the property stabilizes and permanent financing becomes available.
Fast Closing Required
Conventional lenders take 60–90 days. Bridge lenders can close in 10–21 days. When a purchase or refinance has a hard deadline that conventional lenders can’t meet, bridge is the answer.
Credit or DSCR Issues Prevent Conventional Refinancing
If your DSCR is below lender minimums or you have credit issues, a bridge loan from a private lender (which focuses on collateral rather than borrower metrics) can provide time to improve the property performance or borrower profile. See: DSCR too low for commercial refinance.
How Fast Can a Commercial Bridge Loan Close?
Speed is the defining advantage of bridge lending. Here’s a realistic timeline:
Day 1–2: Submit basic deal information to a broker or lender. Receive preliminary terms or a soft quote.
Day 3–5: Execute a term sheet or letter of intent. Pay application/processing fee if required.
Day 5–14: Lender orders appraisal (sometimes uses drive-by or desktop valuation for speed), reviews title, and completes underwriting.
Day 14–21: Close. Funds wire to pay off existing lender or complete acquisition.
Some lenders can move faster for very straightforward deals with strong collateral. Some will take 30 days for complex or large transactions. The key is engaging early — even “fast” bridge lenders need at least 10 business days to close safely.
Commercial Bridge Loan Terms and Pricing
Term: 12–24 months, sometimes with 6-month extension options.
Rate: 8–13% interest rate, depending on LTV, property type, location, and lender. Most are floating (SOFR + spread) though some fixed-rate bridge options exist.
Amortization: Interest-only. No principal paydown during the bridge period — preserving cash flow for operations or renovation.
LTV: 65–75% of as-is value, or 60–70% of as-stabilized value for transitional properties.
Origination Fee: 1–3 points (1–3% of loan amount), paid at closing.
Prepayment: Usually none or minimal — bridge loans are designed to be paid off early.
Recourse: Varies by lender. Many bridge loans are recourse or include a “bad boy carve-out” on otherwise non-recourse loans.
Quick Comparison: Bridge Loans vs. Permanent Financing
| Factor | Commercial Bridge Loan | Permanent Financing |
|---|---|---|
| Term | 12–24 months | 5–30 years |
| Rate | 8–13% | 5.5–8.5% |
| Amortization | Interest-only | Full amortization (25–30 yrs) |
| Closing Speed | 10–21 days | 60–90 days |
| LTV | 65–75% | 70–80% |
| Origination Fee | 1–3 points | 0.5–1.5 points |
| Use Case | Time-sensitive, transitional properties, credit/DSCR issues | Stable properties, strong metrics, time available |
Use this comparison as a starting point when evaluating which financing path makes sense for your situation. Your broker should help you weigh these factors against your specific property performance and timeline. See also: commercial balloon payment calculator to model your current loan maturity.
Types of Commercial Bridge Lenders
Private Lenders (Hard Money)
Individual or small-fund lenders who focus almost entirely on collateral. Fastest to close, most flexible underwriting, but typically the highest rates. Good for distressed situations, short timelines, or borrowers with credit challenges.
Debt Funds
Institutional funds that deploy investor capital into commercial bridge loans. More process than hard money lenders but more capital, often better pricing, and sometimes non-recourse. Most active in the $2M–$50M range. See our comparison: debt fund vs. bank for commercial real estate.
Regional Banks (Bridge Programs)
Some community and regional banks offer bridge programs for existing customers. Slower than private lenders but priced between hard money and permanent financing. Availability varies significantly by market.
Mortgage REITs
Publicly traded and private REITs that specialize in commercial bridge lending. Often active at larger loan sizes ($10M+) with institutional-grade underwriting. See our roundup: best commercial bridge lenders in 2026.
Bridge Loan vs. Permanent Financing: How to Choose
Use a bridge loan when: you have a hard deadline that permanent lenders can’t meet, your property isn’t yet stabilized, your metrics temporarily fall short of conventional requirements, or you need maximum flexibility during a transition.
Use permanent financing when: your property is stable, your metrics are strong, and you have 60–90 days available. Permanent financing is always cheaper — only use bridge when you have to.
The right broker will evaluate both paths simultaneously and recommend bridge only when it’s genuinely necessary.
Bridge Loans by City
Bridge financing is available nationwide. We work with bridge lenders active in all our licensed markets:
Texas: San Antonio | Dallas | Houston
Florida: Fort Lauderdale | Miami | Tampa
North Carolina: Durham | Charlotte | Raleigh
Frequently Asked Questions
What is the minimum loan size for a commercial bridge loan?
Most bridge lenders have minimums of $500K–$1M. Some private lenders go as low as $250K. For loans above $20M, the lender universe narrows — debt funds and mortgage REITs are the primary sources.
Do I need good credit to get a commercial bridge loan?
Credit matters less for bridge loans than for conventional loans. Private lenders focus primarily on the property’s value, the equity cushion, and the exit strategy. Borrowers with credit scores below 600 can still qualify with the right collateral.
What is the exit strategy for a commercial bridge loan?
Every bridge loan needs a clear exit — how you’ll repay it when it matures. Common exits: refinancing into permanent financing once the property stabilizes, selling the property, or securing a long-term loan once DSCR improves. Lenders evaluate exit strategy as part of underwriting.
Can I get a commercial bridge loan on a property in foreclosure?
Sometimes. Private lenders occasionally lend on pre-foreclosure situations if there’s sufficient equity. Speed is critical — engage a broker immediately if you’re in or approaching foreclosure.
How RefiLoop Helps
RefiLoop has direct relationships with commercial bridge lenders across all property types and deal sizes. We can have competing bridge terms in front of you within 24–48 hours — and we’ve helped clients close bridge loans in as little as 12 days when the situation was urgent.
NMLS #2510864. No upfront cost. No exclusivity. We get paid only when you close.
Property Types We Finance
RefiLoop sources refinance options across all major commercial property types. Find lender options specific to your asset class:
- Multifamily balloon loan refinance
- Retail strip center refinance lenders
- Industrial property commercial refinance
- Mixed-use building refinance
- Self-storage facility refinance
- Office building commercial refinance
About David Greenbaum
David Greenbaum is a commercial mortgage broker and co-founder of RefiLoop. He specializes in helping commercial property owners refinance maturing loans between $200K and $15M across Texas, Florida, Georgia, North Carolina, Ohio, and other priority markets. With hands-on experience in commercial bridge loans, debt fund financing, and conventional CRE refinancing, David helps borrowers find the right capital source for their situation — not just the easiest one.