Closing Timelines Topic

General Landlording & Rental Properties
2dFollow

Closing Timelines Topic

Linda Murray
Real Estate Broker · Frankfort, KY · Member since 2019 · 150 posts · 44 votes

When a property has a tight closing deadline, how do you evaluate whether bridge financing is worth considering?

Beyond speed, I'd want to understand the financing costs, repayment timeline, and exit strategy before moving forward.

What would make a bridge loan a practical option for your deal?

0Reply
199 views

5 Replies

Jump to latestLatest
  • Matthew MorrowBusiness Member
    Investor · PA - NY - NJ · Member since 2019 · 552 posts · 193 votes
    1d

    @Linda Murray Bridge is really only useful in a few cases, and the cost can be a huge deterrent. But you can't always control the scenario. We use it most when someone wants to make a non-contingent offer on a new home, the bank recognizes the equity in their existing one, and they can float both mortgages for a short stretch. Either way, the exit needs a date on it, not a hope. Is your deadline seller-driven or a rate lock?

    [email protected]484-791-6200
    CORE Team | Realty ONE Group Supreme547 Reviews
    WebsiteView Page
    0Reply
  • Adam Summerer
    Lender · Franklin, TN · Member since 2026 · 79 posts · 15 votes
    1d

    I'd price it all in for the realistic hold, not the best case: points, interest, and any extension fees, then compare that to what you lose if the deal goes away. If the refi or sale exit isn't pretty solid on day one, thats usually the sign to pass.

    0Reply
  • John Leland
    Specialist · I give advice - [email protected] - I focus on states where investing is profitable, reasonably safe & secure · Member since 2026 · 107 posts · 29 votes
    1d
    Quote from @Linda Murray:

    When a property has a tight closing deadline, how do you evaluate whether bridge financing is worth considering?

    Beyond speed, I'd want to understand the financing costs, repayment timeline, and exit strategy before moving forward.

    What would make a bridge loan a practical option for your deal?

    What length of time were you thinking the bridge would be for?

    0Reply
  • Jim Johnson
    Real Estate Agent · Memphis · Member since 2026 · 583 posts · 344 votes
    1d

    A bridge loan makes sense when the closing deadline is tight, the deal still works after the higher financing costs, and there's a realistic plan to pay it off. The exit strategy is probably the biggest factor. If refinancing or selling gets delayed, there needs to be enough room in the numbers to handle that without creating another problem.

    0Reply
  • Simon W.Business Member
    Real Estate Consultant · Lehigh Valley PA & New York City · Member since 2013 · 1k+ posts · 673 votes
    7h

    Everyone's covered the exit, so I'll add the part that shows up later in the books.

    The interest is a cost of the months you carry it. The points get spread over the life of the loan, so on a $300k bridge with 2 points, that's $6,000 over 12 months, about $500 a month. If you refi out in month 7, whatever's left of the points gets written off when the bridge is paid off. On a flip it's simpler, the financing costs usually just go into the project cost and come off when you sell.

    When you price it, I'd run the whole stack: points, interest for the realistic hold and not the hoped-for one, extension fees, and the closing costs on the take-out loan. That's usually where a bridge that looked cheap stops looking cheap.

    Accounting Properties LLC
    View Page
    CFO LLC
    View Page
    0Reply
Join the conversationCreate a free account to reply, vote on answers and follow this thread.
Log InJoin for Free