Let’s start with the basics: what is a bridge loan? A bridge loan is temporary financing used to close on a real estate transaction quickly while looking for a permanent financing option. Bridge loans are short term loans that come into play in situations considered too risky for banks to provide traditional loans.
Yes, the rates and points for hard money bridge loans provided by NLDS Corp. are more expensive than bank loans, but NLDS Corp. is willing to provide short term loans in riskier situations than banks are.
1. Commercial Rehabilitation
Let’s say you found a commercial property that’s in good condition, but is not generating a profit on paper. A traditional bank likely would not be willing to lend in that situation. However, if you have a solid plan for upgrading the property, attracting new tenants, and making the building profitable again, NLDS Corp. would consider lending to you even if you don’t have good credit.
Once the property is profitable, you can find more traditional financing and pay back the bridge loan.
2. Quick Closings
One of the best ways to make money on property is to buy from motivated sellers who are willing take less than what a property is worth to close quickly. The problem, of course, is that these sellers are not always willing to sit around while you try to secure traditional financing from a bank.
NLDS Corp. bridge loans are designed specifically for these situations. We provide same day decisions, and can close loans in as little as 7 days. You can close on the property quickly, take time to secure traditional financing, and pay back the bridge loan later.
3. Partner Buyouts
This is another common situation. Several people go into a real estate project together, but one of the partners gets cold feet and decides he wants to get out before the project is complete. Well, all the money is already tied up in the project, so what do you do?
Hard money bridge loans can be used to quickly buyout your partner without delaying your construction project. Once the project is complete, you can simply use the profits to pay back the bridge loan.