Florida Bridge Loans

A Florida bridge loan is interim financing for an individual or business until permanent or the next stage of financing can be obtained. Money from the new financing is generally used to "take out" (i.e. to pay back) the Florida bridge loan, as well as other capitalization needs.

Florida bridge loans are typically more expensive than conventional financing because of a higher interest rate, points and other costs that are amortized over a shorter period, and various fees. To compensate for the additional risk the lender may require cross-collateralization and a lower loan-to-value ratio.

Florida bridge loan interest rates are usually 12-15%, with typical terms of up to 3 years. 2-4 points may be charged. Loan-to-value ratios generally do not exceed 65% for commercial properties, or 80% for residential properties, based on appraised value.

There are two types of bridge loans. With the first, you borrow the money to pay off your existing mortgage and enough to make your desired down payment on your new home. You're usually not required to make monthly payments on your bridge loan. Instead, you make only the monthly mortgage payment on your new home, and when your old home sells you use the proceeds to pay back all the accrued interest and the outstanding balance on the bridge loan.

With the second type of bridge loan you keep your current mortgage, but borrow against the equity in your current home and use that money as the down payment on your new home.

Most banks do not offer Florida real estate bridge loans because the speculative nature, risk, lack of full documentation. A bank that issued Florida bridge loans might have difficulty justifying its lending practice to its investors and government regulators.

Florida bridge loans are more likely to come from individuals, investment pools, and businesses that make a practice of the higher-interest loans.

Florida bridge loan programs can give borrowers a fresh start and let them get back on track to repairing their damaged credit, while also allowing them to keep their home.

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Florida Bridge Loan Specialists

• 1st Bridge
• Principal Commercial
• Lending Well
• Best Rate Loans
• The Commercial Loan
• Capital Source
• Madison Realty Capital