Commercial Bridge Financing Q & A

What is bridge financing?

A bridge financing loan is a short term, no prepayment penalty, interim loan.

Why use bridge financing?

Bridge financing loans are ideal for transactions a) whose previous financing fell through b) needing to close quickly c) soon to be sold or refinanced d) shy of qualifying for long term financing or e) needing additional stabilization.

What are the bridge loan terms?

Our bridge financing loans are fixed up to 12 months (with a potential 12 month extension) at a fixed interest rate of 9.75%. There is no penalty for early prepayment. We can lend up to 75% LTV, depending on the property type.

Which properties are eligible for bridge financing?

Office, retail, multifamily, warehouse, light industrial and self storage facilities. Must be an income producing property.

Which properties are not eligible for bridge financing?

Construction, land, restaurants, bars, gas stations, hotels or properties requiring significant rehabilitation.

What are your fees for bridge financing?

Our origination fee is 2% of the loan amount. Additional fees include a $1,500 processing and $1,000 documentation prep fee. We also require a $2,500 inspection fee to be paid prior to the loans closing.

How do I get paid?

Because our bridge financing loans have no prepayment penalty, we cannot offer yield spread. Per your fee agreement with your borrower, you can charge any agreed amount in addition to our 2% origination fee.

Must bridge financing loans debt service?

Yes, but we can be flexible with our underwriting depending on exit strategy or strength of the borrower. Where a property lacks in debt service, we will look to the borrowers ability to make the payments. We cannot set up interest reserves.

Are your bridge financing loans stated or low doc?

Yes to a degree. Depending on the LTV and cash equity, we can accommodate some reduced documentation. We will always verify assets (bank statements, etc.)

Is a bridge financing loan hard money?

No. Hard money loans have higher rates and charge more points. As a result, however, hard money can be more accommodating with documentation and property types.

Are commercial bridge financing loans similar to residential bridge financing loans?

A commercial bridge financing loan is different from a residential bridge financing loan in that equity from another property is not required to complete the financing of the subject property. However, we can cross collateralize properties owned free and clear.

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Call us today or:

Security National Capital, Inc.

5300 S. 360 W., Suite 310
Salt Lake City, UT 84123
Phone: 800-760-3384
Fax: 888-329-6535

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