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Commercial real estate
Commercial Bridge Loans
Commercial bridge loans provide short-term CRE financing for acquisitions, renovations, lease-up, and repositioning when speed and flexibility matter more than permanent loan pricing.
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65-75%
Max LTV
12-36mo
Loan Term
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7.5-13%
Interest Rates
2-3wks
Close Time
Overview
Common Bridge Loan Use Cases
Commercial bridge loans are short-term commercial real estate loans used when a property needs speed, flexibility, or repositioning before permanent financing is possible.
Quick Property Acquisition
Need to close on a property in 14-30 days before permanent financing is ready
Rate
7.50% - 10.00%
Term
12-24 months
Timeline
2-3 weeks to close
6-18 months to permanent loan
Exit
Refinance
Example Scenario:
Off-market multifamily deal requires all-cash offer. Bridge loan allows quick close, then refinance to agency loan after 6 months.
Value-Add Renovation
Property needs significant improvements before qualifying for permanent financing
Rate
8.00% - 11.00%
Term
12-36 months
Timeline
2-4 weeks to close,
12-24 months renovation
Exit
Refinance
Example Scenario:
Class C apartment building at 65% occupancy. Renovate units, raise rents, increase to 90% occupancy, then refinance.
Lease-Up Financing
Property is vacant or under-occupied and cannot qualify for permanent loan yet
Rate
8.50% - 11.50%
Term
18-36 months
Timeline
3-4 weeks to close,
12-24 months lease-up
Exit
Refinance
Example Scenario:
Newly constructed office building with no tenants. Bridge loan funds acquisition, covers debt service during lease-up to 85% occupancy.
Cash-Out Recapitalization
Extract equity from stabilized property for another investment or business need
Rate
7.50% - 9.50%
Term
12-24 months
Timeline
2-3 weeks to close,
refinance when permanent rates improve
Exit
Refinance
Example Scenario:
Own property free-and-clear worth $5M. Bridge loan $3.5M (70% LTV), use proceeds for down payment on second property.
Loan Maturity Extension
Existing loan maturing, need time to improve property performance or wait for better permanent rates
Rate
8.00% - 12.00%
Term
12-24 months
Timeline
2-3 weeks to close,
12-18 months to improve property
Exit
Refinance
Example Scenario:
CMBS loan maturing with $3M balloon payment. Property DSCR only 1.15x. Bridge loan pays off maturing loan, gives time to raise rents and improve DSCR.
Construction Bridge/Gap
Construction loan ending but project not stabilized enough for permanent loan
Rate
8.50% - 12.00%
Term
12-36 months
Timeline
2-4 weeks to close,
6-18 months to stabilization
Exit
Refinance
Example Scenario:
New apartment building complete but only 60% leased. Construction lender wants exit. Bridge loan provides 6-12 more months to reach 85% occupancy.
Bridge Loan Planning
Exit Strategies
Every commercial bridge loan needs a documented exit strategy, usually refinance, sale, extension, or cash-out once the property improves.
Timeline
12-24 months
Requirements
4 items
Property stabilized
DSCR 1.25x+
Occupancy 80-85%+
Credit 680+
Timeline
12-36 months
Requirements
4 items
Renovations complete
Property stabilized
Market conditions favorable
Buyer secured
Timeline
+6-12 months
Requirements
4 items
Lender approval
Extension fee (0.5-1%)
Property performing
Clear exit plan
Timeline
12-24 months
Requirements
4 items
Increased NOI
Higher appraised value
DSCR 1.30x+
LTV ≤75%
Borrower Requirements
Qualification Criteria
Commercial bridge loan qualification is primarily driven by credit strength, prior CRE experience, leverage, reserves, and a realistic exit plan.
Common Questions
Frequently asked questions
These answers cover the most common questions about CRE bridge loans, including rates, timelines, fees, qualifications, and exit planning.
What is a commercial bridge loan and when should I use one?
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A bridge loan is short-term financing (12–36 months) for Speed (close in 2–4 weeks), Value-Add (renovate to increase rent), Lease-Up, or Cash-Out. It bridges the gap until the property qualifies for permanent financing.
What are current commercial bridge loan rates in 2026?
Rates range from 8.50% to 12.00%+. Most are floating rate (SOFR + Spread) and interest-only. Origination fees are 1–3 points. Rates depend heavily on LTV and the strength of the exit strategy.
How fast can I close a commercial bridge loan?
Typical timeline: 2–4 weeks. This speed allows you to capture time-sensitive opportunities. BestLoanUSA pre-qualifies your deal with bridge lenders to accelerate the process.
What are the exit strategy options for a commercial bridge loan?
Every bridge lender requires a documented exit strategy. The primary options are: (1) Refinance into a permanent loan once stabilized (DSCR > 1.25x), or (2) Sale of the property after renovation. Without a clear exit, a bridge loan cannot be approved.
What fees should I expect with a commercial bridge loan?
Origination Fee: 1–3% of the loan amount. Exit Fee: 0.5–1% (sometimes charged at payoff). Extension Fee: 0.5–1% (if you need more time). The premium buys speed and flexibility for deals banks won’t touch.
What qualifications do I need for a commercial bridge loan?
Credit score: 600–620+ minimum (680+ gets better rates). Experience: lenders prefer a track record of successful exits. LTV: max 70–75% of as-stabilized value. Liquidity: 6–12 months of interest reserves.
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