Construction Bridge Loan Financing

“Construction Bridge Loan Financing Can Be Critical To Getting a Construction Project Completed”

private mortgage broker contact
Construction bridge loan financing is a more requirement for both residential and commercial construction projects than you might think.

The purpose of the construction bridge loan is to cover off a cash flow shortage that exists at some point in the project.

This can happen at any point, but typically occurs in the last 20% of construction.

Some of the reasons for requiring a construction bridge loan include unplanned cost overruns, changes in project scope, and draw cut backs or delays with the primary construction lender.

Regardless of the reason, funds are required and typically there is an urgency to locate and secure the additional capital as soon as possible.

Because of the speed required, almost all construction bridge loans are provided by private mortgage lenders that have a focus on this type of lending. In terms of all available private lenders, including those that regularly fund construction projects, there tend to be only a small number that will provide these bridge loans due to the fact that a lender needs to be able to react quickly enough to meet the needs of the borrower.

Construction bridge loan requests that are made near the beginning of the project will fall in the 65% to 75% range for loan to value on the fair market value of the project at the point where the construction bridge loan is being made.

If a request is made for a construction bridge loan when the project is 80% complete or higher, the loan to value that can be advanced can be 85% or higher, depending on the lender’s assessment of risk related to the remaining work and their own assessment of the marketability of the completed project.

Construction bridge loans are typically secured by a second mortgage against the property, registered directly behind the primary construction mortgage.

Because there are relatively few private lenders that provide this type of financing in a timely enough basis, its going to be important to be working with a private mortgage broker who actively places these types of deals and well established construction bridge loan sources.

If you are in need of a construction bridge loan for an existing project, I suggest that you give me a call so I can quickly assess your requirements and provide private mortgage financing options for your immediate consideration.

Click Here To Speak Directly To Toronto Private Mortgage Broker Joe Walsh For A Free Assessment Of Your Construction Bridge Loan Options

Leave a Reply

Your email address will not be published. Required fields are marked *


Borrower’s Next Step
If you need to acquire private mortgage funding right now, or want to better understand your options, click the green button below for more information
Broker’s Next Step
To find out more about how our broker referral program works, click the blue button below
Investor’s Next Step
Click the green button below to learn more about private mortgage investing and the services we offer.
Professional Affiliations
Private Mortgage Articles