Interim Bridge Loan

Definition:
type of short-term financing that is provided to borrower while the property is being built to bridge the projects start and finish with additional funding.

Examples: Coming soon.

When funding is needed – Used when an investor, equity partner or lender leaves the project or when initial funds have been exhausted.

An Interim Loan provides financing to the purchaser of the property before/while it is being constructed. The money is given to the contractor to finish the construction of the property. An interim loan is generally combined with a second source of long-term financing that comes into play when the construction of the property is complete. Throughout the duration of the construction phase the borrower is locked into fixed, interest-only payments.

Amortization
Interim Financing are primarily interest only loans that do not amortize over the short life of the loan.

Term
Interim loans typically range between two and three years, but are offered between six months and five years depending on the size and scale of the project.