What Are Multifamily Bridge Loans and What Are They Used For?

02 Jan What Are Multifamily Bridge Loans and What Are They Used For?

Getting the funds you need to secure your next commercial property can be hard for numerous reasons. Regardless, expanding your portfolio is a must. And you need funding in order to do it. That’s why commercial property owners benefit from learning how multifamily bridge loans work. 

Multifamily bridge loans allow immediate access to funds. These funds are used to quickly finalize the purchase of a property. Having that funding allows commercial property owners to obtain properties or make certain upgrades. So this allows them to continue searching for long-term financing options. There are numerous reasons why a multifamily bridge loan could be the perfect solution for you.

Who Benefits From Obtaining a Multifamily Bridge Loan

The best candidates for multifamily bridge loans are typically commercial property owners with multiple properties, who are in a hurry to close on their next property. That’s because having many properties in your portfolio is beneficial. It allows borrowers to use the rent proceeds from the new property to pay off their bridge loan. Another reason why multifamily bridge loans appeal to borrowers in a time crunch is that multifamily bridge loans can be closed in about 5-10 business days with Nelson Lending. Your waiting period could be twice as long if you choose a traditional funding option. Having an understanding of your timeline, along with other responsibilities related to closing on your next property is a necessity.

When Should You Start Exploring Your Options for Multifamily Bridge Loans

Timing is the most important variable when securing your next property, along with funding for it. That’s why property owners in the process of purchasing new properties should begin exploring their options. This helps rule out the possibility of going to a traditional lender for financing needs. Waiting on funding can allow another investor to snatch up your ideal property. So the sooner you begin exploring your options for a multifamily bridge loan, the quicker you can get to pay it off and get the long-term financing solution you need. 

What Differentiates Multifamily Bridge Loans From Traditional Lending Options?

There are a variety of factors that distinguish multifamily bridge loans from more traditional lending choices. One differing factor between multifamily bridge loans and standard loans is collateral.  The fact is that collateral may not be as helpful when it comes to obtaining traditional loans. That’s because the approval standard for a traditional loan is more rigid, rather than considering multiple variables. Another difference between traditional lending options and multifamily bridge loans is that you can prepay multifamily bridge loans. This could result in increased financial flexibility that you won’t get from traditional lenders.

Why Should You Consider Obtaining A Multifamily Bridge Loan

There are numerous reasons why a multifamily bridge loan is particularly appealing to you. The hassle of getting funding from a traditional lender has the potential to leave you in limbo for an undetermined amount of time. There’s also the potential that they may turn you away for reasons beyond your control. That’s why these are some of the biggest reasons people seeking funding for new property fast choose multifamily bridge loans:

Increased Flexibility

While traditional lenders are likely to have standards they must adhere to when it comes to providing financing, multifamily bridge loans can be more willing to work with you. Let’s say this isn’t your first rodeo when it comes to investing in a property, and you have the portfolio to back it up.

If that’s the case, a multifamily bridge loan lender may be willing to base your financing on the business plan you have for your prospective property. This type of increased flexibility has the potential to make a noticeable impact on your long-term plans.

Shorter Commitment Period

Another reason why a multifamily bridge loan may catch your attention is that they don’t come with the long-term commitment attached to traditional lending options. In most cases, these loan terms range from a matter of months to a couple of years.

This is a massive benefit for lenders who are hoping to avoid long-term repayment commitments in the process of obtaining funding. Such an opportunity would be nearly impossible to find among traditional lenders.

Fast Access to the Funding You Need

Since multifamily family bridge loan lenders don’t use the same system to make lending decisions as traditional lenders, your odds of being turned away because of your credit score are greatly decreased. Additionally, since bridge loan lenders don’t have to meet the same stringent requirements as traditional lenders, they can provide you with the funding you need faster than you think. 

In most cases, multifamily bridge loans can be provided in just a matter of days. This can be pivotal in securing property while it’s still on the market and continuing to develop your portfolio.

Get More Details About Obtaining a Multifamily Bridge Loan From Nelson Lending Today!

Multifamily bridge loans could be instrumental in helping you get the funding you need to secure your next property. However, the process of obtaining a multifamily bridge loan may be daunting if you don’t know where to look. There are more places than you think that offer multifamily bridge loans, fortunately. One of your best options for obtaining the funding you’re seeking is Nelson Funding.

The knowledgeable and friendly staff is eager to help connect you with the funds you’re searching for. Having years of experience helping people like you get funding for a variety of projects provides the staff at Nelson Funding with the expertise you need to make the right decision. If you’re on the hunt for a multifamily bridge loan lender capable of providing you with the financing you need, get in touch with the staff at Nelson Funding today.