On this page
- Bridge loan definition
- How does a bridge loan work?
- Homeowner vs investor bridge loans
- Investor bridge loan terms by lender
- Bridge loan vs conventional loan
- Pros and cons
- How to qualify for a bridge loan
- Bridge loan example: loan size and interest
- When an investor bridge loan makes sense
- Questions to ask a bridge lender
- Alternatives to a bridge loan
- Related guides
- Frequently asked questions
Based on each lender's published information; we did not apply for loans.
Bridge loan definition
A bridge loan is a short-term loan that carries you from one transaction to the next: you buy before you sell, or you buy now and replace the loan with long-term financing later. The loan is secured by real estate and is repaid in one payment when you sell or refinance.
Federal lending rules give the closest thing to an official definition. Regulation Z excludes from its ability-to-repay requirements (paragraphs (c) through (f)) "a temporary or 'bridge' loan with a term of 12 months or less, such as a loan to finance the purchase of a new dwelling where the consumer plans to sell a current dwelling within 12 months ..." (12 CFR 1026.43(a)(3)(ii)). That describes the homeowner version. Investors use the same idea on rental and resale properties, with loans that usually run longer.
How does a bridge loan work?
The lender sizes the loan on the property, you pay interest only during the term, and the loan is paid off by a sale or a refinance. A bridge loan differs from a fix-and-flip loan mainly in the rehab money: Lima One describes its bridge loan as like a fix-and-flip loan in length and interest-only structure, but without rehab funds. If the property needs major work, see fix-and-flip loans instead.
Homeowner vs investor bridge loans
Homeowner bridge loans are consumer credit. Investor bridge loans are business-purpose credit, which 12 CFR 1026.3(a) exempts from Regulation Z, so lenders can size them on the property instead of your income. If you plan to live in the property, read owner-occupied hard money loans first.
Investor bridge loan terms by lender
| Lender | Leverage | Term | Loan size | Min credit | Other terms |
|---|---|---|---|---|---|
| Lima One Capital (Bridge Plus) | Up to 85% LTV (its FAQ says up to 80%) | 13 or 19 months | $100K to $5M | 700 | Interest only; no prepayment penalty; cash-out options; no rehab funds |
| Ternus | Up to 100% LTC, not to exceed 70% of as-is value | Not stated | Not stated | 660 | Rent-ready investment properties; no appraisal required; $0 prepayment penalty |
| LendingOne | Up to 100% LTC or 80% ARV | Not stated | Not stated | Not stated | Stressed or rent-ready condition; no W-2s or pay stubs; appraisal in-house or waived |
| CoreVest | Up to 100% of cost, 75% of value | Not stated | $75K to $2M+ | Not stated | No DSCR requirement; no prepayment penalty |
From each lender's own website, read October 29, 2026. "Not stated" means the pages we read do not say. Terms change; confirm with the lender. Not financial advice.
More bridge programs, costs and exit planning are on the bridge loans compared page.
Bridge loan vs conventional loan
LendingOne publishes its own side-by-side comparison. Its figures describe its bridge program and its view of conventional loans:
| Bridge loan (LendingOne) | Conventional loan (LendingOne's description) | |
|---|---|---|
| Property condition | Stressed or rent-ready | Turn-key |
| Leverage | Up to 100% LTC or 80% ARV | Typically 70-80% LTV |
| Income verification | No W-2s or pay stubs | Full income documentation |
| Appraisals | In-house or waived | Third-party appraisals often required |
| Best suited for | Investors, flippers, builders and developers | Homeowners or long-term buy-and-hold |
Pros and cons
| Pros | Cons |
|---|---|
| Close on a property that a conventional lender will not finance yet (stressed or not stabilized) | Short term: you need a sale or refinance lined up |
| Sized on the property; LendingOne asks for no W-2s or pay stubs | Interest-only payments do not pay down the balance |
| Lima One's Bridge Plus and CoreVest's bridge loans carry no prepayment penalty | No rehab money at Lima One; renovations need a fix-and-flip loan |
| Leverage up to 100% of cost at Ternus, LendingOne and CoreVest | Caps on as-is value (70% at Ternus) can cut the loan |
How to qualify for a bridge loan
Credit and property
Lima One asks for a 700 credit score on Bridge Plus and Ternus a 660 minimum. Ternus lends on rent-ready properties; LendingOne accepts stressed or rent-ready condition.
Exit plan
Show how you will repay: a sale price backed by comparable sales, or a refinance the new lender will size high enough. Check the takeout lender's limits with the DSCR calculator before you close.
Bridge loan example: loan size and interest
A rent-ready rental bought for $250,000 that appraises at $250,000 as is. Each lender's published cap sets the loan; interest is shown at an example rate of 8.90% (Easy Street Capital's advertised starting rate, because Lima One and Ternus do not publish a bridge rate), interest only, for Lima One's two term lengths.
| Lender | Published cap | Loan | Your cash before costs | Monthly interest at 8.90% | 13 months | 19 months |
|---|---|---|---|---|---|---|
| Lima One Bridge Plus | 85% LTV | $212,500 | $37,500 | $1,576.04 | $20,489 | $29,945 |
| Ternus | 100% LTC, max 70% of as-is value | $175,000 | $75,000 | $1,297.92 | $16,873 | $24,660 |
Ternus advertises up to 100% of cost, but its 70% as-is cap sets the loan when the price equals the value, so you bring $75,000 before costs. Lima One's 85% cap (from its program highlights) leaves $37,500. A 19-month term costs $9,456 more interest than 13 months on the Lima One loan, which is why the exit date matters as much as the rate. Points, title and insurance come on top. Lima One's FAQ gives 80% LTV and says not all properties qualify for maximum leverage, which would make the loan $200,000 and your cash $50,000.
When an investor bridge loan makes sense
- A rent-ready property you need to close on fast. Ternus's bridge program is built for rent-ready investment properties, sized on cost and as-is value.
- A property that is not stabilized yet. LendingOne accepts stressed or rent-ready condition, where a conventional lender wants turn-key.
- A short hold before a rental loan. Kiavi lets you pull rental cash-out immediately when you refinance one of its own bridge loans, instead of waiting 90 days.
Questions to ask a bridge lender
| Question | What lenders publish |
|---|---|
| What is the term, and can it be extended? | Lima One offers 13 or 19 months; your sale or refinance has to land inside the term. |
| Is the loan capped on as-is value? | Ternus lends up to 100% of cost but never more than 70% of as-is value. |
| Is there a prepayment penalty? | Lima One Bridge Plus and CoreVest say there is none. |
| Do you need a third-party appraisal? | LendingOne says appraisals are in-house or waived. |
| Is there a DSCR test? | CoreVest's single-asset bridge loan has no DSCR requirement. |
| Can I refinance with you afterwards? | Kiavi allows rental cash-out immediately on its own bridge loans. |
| What credit score do you need? | 700 for Lima One Bridge Plus; 660 at Ternus. |
Alternatives to a bridge loan
- Fix-and-flip loan: adds rehab funds paid in draws. See fix-and-flip loans compared.
- DSCR rental loan: a 30-year loan if the property already rents. See DSCR loans.
- Cash-out refinance of a property you own: raise the cash before you buy. See DSCR cash-out refinance.
- For homeowners: a home equity line of credit or a sale-contingent offer avoids carrying two loans.
Which fits depends on the property's condition and your exit. If it needs a renovation budget, use a fix-and-flip loan; if it already rents at a ratio the lender accepts, go straight to a DSCR loan and skip a second set of closing costs; if you need to close fast on a property that is not yet stabilized, a bridge loan buys time.
Related guides
Frequently asked questions
What is a bridge loan?
A short-term loan, secured by real estate, that covers the gap until you sell a property or replace the loan with long-term financing. Regulation Z describes the homeowner version as a temporary or bridge loan with a term of 12 months or less.
How hard is it to get a bridging loan?
For investors it turns on the property and your exit more than your income: LendingOne asks for no W-2s or pay stubs. Credit still matters; Lima One asks for 700 on Bridge Plus and Ternus 660.
How much would a $300,000 bridging loan cost?
At Easy Street Capital's advertised 8.90% starting rate on its fix-and-flip and bridge product, interest only on $300,000 is $2,225 a month, or $26,700 over 12 months, plus 0 to 2 points ($0 to $6,000) and a $1,995 document fee. Title, insurance and closing costs come on top, and your rate depends on your file.
Do bridge loans have prepayment penalties?
Investor bridge loans often do not: Lima One's Bridge Plus and CoreVest's bridge loans carry no prepayment penalty. Ask before you sign, because you plan to repay a bridge loan early by design.
What are the alternatives to a bridge loan?
Investors can use a fix-and-flip loan (adds rehab funds), a DSCR rental loan if the property already rents, or a cash-out refinance of a property they own. Homeowners often use a home equity line of credit or a sale-contingent offer.