Obtain a Bridge Loan Online up to $750,000
Are you searching for a bridge loan online? We’ve helped thousands of businesses with short term capital needs, up to $750,000 within 48 hours. Complete our simple online application to find out how much your business qualifies for with no obligations, no impact on your credit score, or application fees.
Bridge loans are a useful tool for businesses that need access to cash quickly. They provide an interim solution to the problem of funding, but there is no denying that they come with risks. That is why it’s important to understand how bridge loans online work and what you need to consider before applying. Below you will learn what bridge loans are, how they work, as well as their advantages and disadvantages.
What Is a Bridge Loan?
When it comes to liquidity, the bridge loan is a popular choice. A bridge loan is short-term financing to “bridge” a gap in funding. The term of a bridge loan can be short-term, typically a few months to a year, and would allow a company time to refinance their existing debt or secure additional capital for current projects. This type of financing works best in situations where lower amounts are involved, the loan will be repaid quickly and an immediate need is present.
A bridge loan should not be confused with a hard money loan because it does not require collateral. It could also be used as an alternative for starting a new business by giving you time to plan out your financing strategy.
Bridge Loan Example
A bridge loan can be used in situations where an individual or business needs capital during a transition period. Take William for example:
William owns a manufacturing company that creates machine parts. He needs an additional $50,000 worth of materials to complete a $450,000 project that’s 80% completed. He needs additional funds to help cover his materials expenses until he’s able to receive the full project payment. He can apply for a $50,000 bridge loan to help cover his expenses in the interim. He expects to be completed the project in 3-4 months.
How Does a Bridge Loan Work?
A bridge loan is an unsecured loan that works best for short-term financing needs. This type of loan can be repaid quickly and also requires lower financial qualifications than other types of loans. To get a bridge loan, you’ll need to work with private lenders who determine your eligibility based on several factors including credit score, current income levels, debt obligations, business experience, and other personal information. Much like a traditional bank loan, your creditworthiness is an important factor in whether or not you get approved for the loan.
To get approved for a bridge loan, you’ll need to provide personal financial records including recent pay stubs, tax returns, and bank statements. Like with any type of financing, your business plan plays a big role in whether or not you get approved for a loan. If you have a detailed plan with a solid foundation and logical strategy, lenders will be more likely to approve your loan request.
How to Repay a Bridge Loan
If you’ve recently taken out a bridge loan, be sure to read your contract carefully and follow all payment expectations outlined by the agreement.
The repayment of a bridge loan is similar to other types of loans. You’ll need to make monthly payments that cover the interest and principal on your loan. Since this type of financing is short-term, you’ll end up paying high amounts of interest on the amount borrowed. A good way to save money when repaying this kind of loan is to negotiate a lower interest rate with your lender.
Other repayment options for bridge loans include requiring the full amount to be repaid in full at the end of the agreed-upon terms, plus additional fees and interest charges.
How Much Does a Bridge Loan Online Cost?
There are several factors that influence the total cost of a bridge loan. This includes the interest rates, fees, and other charges associated with your contract. Since it’s unsecured, you’ll need to pay high amounts of interest when borrowing money – much like when you get credit card cash advances or payday loans.
Bridge Loan Online Rates
Bridge loan rates are typically higher than other types of loans, averaging between 6% and 30% APR. You may need to pay high monthly payments or finance charges if you don’t have the ability to repay the full amount at once. The lender will also charge a fee to process the loan which can vary between lenders.
Pros and Cons of Bridge Loans
As with any type of loan, there are pros and cons to consider. These are laid out below.
What Are the Benefits of Bridge Loans?
A bridge loan is a great option if you have a short-term capital need, but don’t want to take out a long-term financing contract. You can get access to financing quickly and easily without needing collateral or other forms of documentation. Bridge loans often attract borrowers who may not be as creditworthy as those with a strong financial history.
What Are the Drawbacks of Bridge Loans?
Bridge loans are considered high-risk financing options. Interest rates on bridge loans are typically higher than other options typically offered by a conventional bank loan or line of credit. You also need to be prepared for additional fees such as appraisal, processing, late payment penalties, etc. Lenders will use your credit score to calculate how much money you can borrow and at what rate. If your score is not so good, you’ll probably have to settle for a higher APR and less appealing options.
Bridge Loan Alternatives
If you’ve been turned down for a bridge loan or don’t want to take out another type of financing, consider using a hard money lender. This is an option that’s great if you’re looking for short-term financing and can provide collateral such as real estate.
A hard money lender provides funding when other types of traditional lenders won’t do so. These lenders typically work with borrowers who don’t have the best credit history or people looking for a specific purpose loan. Instead of using your personal credit score, they’ll look at the value of your collateral and use this to determine how much money you can borrow and what interest rate you’ll be charged.
A home equity line of credit, or HELOC allows you to borrow against your home or business’s equity. These are best for borrowers who have a strong credit score and access to collateral such as real estate. This type of financing is beneficial if you want a flexible repayment plan or don’t want to tie yourself down to a specific loan term. If you’re looking for the cheapest option, then it’s best not to get a HELOC since they typically have a higher interest rate. However, you’ll have the option of drawing from your line of credit as needed with no restrictions.
If you have strong sales history but are in need of immediate funds, utilize a commercial cash advance. These cash advances enable your business to borrow from future earnings, without needing a loan. These are repaid as a percentage of your sales and can be funded within a couple of business days. They don’t have strict requirements and are also available to subprime borrowers.
Lastly, if your short-term capital need is due to unpaid invoices, you may also consider invoice financing as a means to secure capital. This allows you to receive up to 80% of your unpaid invoice amounts. This can provide you with a boost of funds to hold your business over until the payments are made on your invoices.
Bridge Loan Frequently Asked Questions
Can I Get a Bridging Loan for Construction?
Yes, if you’re working with a contractor or builder then you can use the loan to fund the construction process. If your primary goal is to pay back the financing quickly, however, it’s best not to get this type of loan since it may take months before you are able to do so.
How Hard Is It to Get a Bridge Loan Online?
It’s often easier to get a bridge loan online since this type of financing doesn’t typically require collateral as long as you meet the requirements and have the proper documentation. If you have unfavorable credit, bridge loans will be difficult to obtain.
How Long Does It Take To Get a Bridge Loan Online?
It usually takes a few minutes to complete the online application form and you can have your funds within 7-10 business days. If you want to get the loan as quickly as possible, then it’s best to provide all necessary information and supporting documentation from the start so that you won’t have to continue updating your application.
How Much Deposit Do I Need for a Bridging Loan?
Bridge loans do not require borrowers to provide a deposit. However, there are some lenders that will ask for or require a high deposit for approval, between 10% and 40%. It’s best to avoid them and find a lender who doesn’t need a deposit.
How Long Does It Take To Get a Bridge Loan?
While the online application process takes just a few minutes, it usually takes at least a few business days for lenders to process your loan. The average bridge loan is funded within 10 business days.
Funding Your Business Is Our Business
Bridge Loan Online in Summary
Bridge loans offer borrowers a short term loan that can provide funding for your business expenses or specific projects until you achieve profitability and are able to pay it back. Make sure you understand all of the terms and conditions associated with any type of financing before signing an agreement. Take some time to shop around for the best option for your business needs.
Don’t Allow a Lack of Funding
to Hold your Business Back
It’s Time To Move Your Business Forward!