A bridge loan is short-term financing — typically 6 to 18 months — secured by real estate that bridges the gap until permanent financing or a sale. Business owners use one when they have a deadline or opportunity a bank can't move on fast enough: a time-sensitive acquisition, unlocking equity in property they own, a partner buyout, or a maturing note. BuildUp Capital makes bridge loans of $250,000 to $5,000,000, underwriting the business and the exit — not just the collateral — with a term sheet in under 5 business days. It's short-term capital you plan to exit, usually by refinancing into long-term debt.
How it works: the loan is secured by commercial or residential real estate and sized to the deal. Because it's short-term and fast, it's priced higher than a conventional mortgage — you're paying for speed and certainty, not a 30-year rate. A good bridge is structured around a clear exit from day one: a refinance into bank or SBA debt, or a sale.
When a bridge makes sense: beating a closing deadline the bank can't meet, pulling usable equity out of a property you own to fund growth, buying out a partner or a competitor on a timeline, or retiring a balloon before permanent financing is ready. The common thread is timing — the deal is good, but the clock moves faster than a conventional process.
When it doesn't: a bridge is the wrong tool for permanent, long-term financing — that's what you refinance into, not the bridge itself. And if you don't have a credible exit, short-term capital just postpones the problem. The disciplined question any lender should ask is “how do you get out of this loan?” — if they don't, treat it as a flag.
What to check in a bridge lender: that they underwrite the exit, not just the collateral; that fees and terms are disclosed up front rather than at closing; that they fund their own capital (faster and more certain) rather than brokering it out; and that they can actually move in days. Most borrowers refinance out within 12 to 18 months.
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Related: Bridge loans · Lending in Texas