How to Close a Commercial Bridge Loan Fast
The increased demand for commercial bridge loans this year is the result of many factors. The bottom line? Banks are not excited about issuing new paper on investment properties, and in fact, Deutsche Bank is selling off it’s commercial paper as fast as it can. The biggest complaint of commercial real estate investors is the scarce supply of bank financing. But for those who have never taken down a commercial bridge loan before, understanding the ins and outs of commercial bridge financing can be confusing. Here’s a few things you’ll need to close a commercial bridge loan in a matter of weeks:
- Property Photos: Have plenty of color photos of the property available, both interior and exterior photos.
- Property Financial Information: Have the property financial information readily available, which is typically Profit and Loss and Statements (Income Statement) for the last 2 years for the property. A profit and loss statement for the year to date is also required. If the property is vacant, have comparables for value readily available.
- Title Report: Have a preliminary title report ready and free of all liens or any other bad marks that may need to be cleaned off.
- Purchase or Refinance Loan? If a purchase have the purchase contract available. If a refinance, have a timeline of the property available, which is an overview on when purchased, how much, any improvements to date, etc.
- List of Repairs: If repairs or tenant improvements will be required, have an itemized breakdown of repairs or improvements.
- Leased or Vacant? If the property is leased have the rent roll and individual leases available as a condition to close.
By having all of these items readily available, you will have the best chance of getting your commercial bridge loan closed in a matter of weeks. Although each lender has different documentation requirements, these are the basic items you need to get your commercial bridge loan on a fast track with your chosen lender.If you’ve never used private money loans before, check out our blog on hard money called ‘Hard Money 101.’ Or if you are ready to take a look at our commercial bridge loan programs, click here.