Apply for a Bridge Loan in Florida
If traditional financing is proving problematic and time-consuming, bridge lending may be the answer. Whether you are a seasoned real estate investor or a first-time borrower looking to secure a down payment on your first investment purchase, a bridge loan provides fast and easy access to cash flow, allowing clients to borrow money through private companies and lenders.
A bridge loan lender offers investment finance loans that do not require a higher down payment. The average interest rate is around 6.99%. Bridge loan lenders prefer individual investors such as entrepreneurs or families who are looking for real property at competitive interest rates rapidly in short-term loan options.
Conventional financing such as a traditional mortgage from a traditional lender is normally a very slow process. Loans typically have upfront fees, require higher credit scores, have a capped loan amount, and demand a repayment schedule of monthly payments, based on an analysis of the borrower’s finances.
The opposite applies to bridge loan borrowers, as a bridge loan requires only minimal information on your personal financial situation, and the process is super quick. The entire process can be completed in a matter of days. Private lending is lightning quick when compared to traditional mortgages, which normally take well over a month to process.
Flexible Options for Florida Bridge Loans
We will work with you to try and make the impossible possible, whatever that may be. Some of the key criteria of our Florida loan offerings include:
Up to 80% loan to value ratio (LTV)
Loans from $100,000 to a maximum loan value of $10,000,000 on a non-owner occupied property
Interest rates starting at 6.99%
- 12 to 24 months flexible loan terms
No prepayment penalty
No minimum FICO score
We will discuss a personalized exit strategy
Here at Lightspeed Lending, we are passionate about taking the stress out of investment lending. If you want to find out more about how a bridge loan can help you, then give us a call.
Read More About Our Private Money Loan Programs
How Do I Get a Bridge Loan in Florida?
In most circumstances, getting a bridge loan is a lot easier than traditional financing. To apply for a loan, make sure that you have already found the property you want to purchase, renovate or flip.
It is critical to have collateral, and the lower the LTV (loan-to-value) is, the better the interest rate offered will be, and the likelihood of being accepted by the lender increases significantly. The higher the collateral, the better the interest rate becomes.
The next step is to find a bridge loan lender; contact a verified lender such as Lightspeed Lending.
On application you will need to provide:
- What is the address of the property?
- What is the agreed purchase price of the property?
If applicable you may need to provide:
- What are the estimated construction costs?
- What is the expected value of the property after construction work is completed (ARV)?
- What is the repair costs value?
The loan provider will validate the request and then, if successful, the lender will make an offer to the client.
The more experience you have with private lending, the more likely you will be successful in the application; however, everyone has to start somewhere, and often a bridge loan is an easier and quicker option than a traditional mortgage.
What Is a BRIDGE Loan? How Does a Bridge Loan Work?
“Bridge loan” is a financial term used to describe a short-term loan to cover the period between buying and selling a home. Bridge loan financing (sometimes known as a private money loan, bridge loan mortgage, bridging loan, gap financing, or hard money loan) is provided by private lenders and offers short-term access to cash that is secured against a tangible asset, usually real estate collateral.
These loans typically are a good option for real estate investors or borrowers who have experienced difficulty securing loans from a traditional bank, who wish to avoid the lengthy process and servicing fees of applying for a traditional loan, or those with poor credit history.
Why Is it Called a Bridge Loan?
Bridge financing “bridges” the gap between the purchase of one asset and the sale of an existing property. Such loans are a common need in real estate transactions where short-term financing is preferable to long-term financing because the loan is expected to be paid off as soon as the real estate asset is sold. For this reason, bridge financing is not used for long-term financing of a home purchase and is instead ideal for someone looking for temporary loans to purchase a new investment property.
How Do Bridge Loans Differ From a Traditional Loans?
The application process for a bridge loan is generally quicker and less stringent than that for a traditional loan. While a traditional mortgage loan typically takes months to close, a residential bridge loan can be closed within days.
This is particularly beneficial in the current fast-moving real estate market, where property deals must be closed quickly to avoid missing out.
There is a lot more red tape involved when it comes to securing traditional mortgages and loans. Bridge loan lenders don’t need to adhere to the same regulations and stringent approval process, meaning that they require less documentation and can work with an investor with a poor credit history or income-to-debt ratio.
What Types of Real Estate do Florida Bridge Loan Lenders Finance?
Hard money bridge loans are used by investors in need of short-term funding for new property investments. They typically apply to single-family homes, townhomes, condos, and multi-family up to 4 units (fourplex, triplex, duplex).
At Lightspeed Lending, all such loans are for non-owner-occupied properties because of regulatory and compliance rules. Lightspeed Lending’s residential bridge loan offering is not normally available for commercially zoned real estate.
Do I Need a Bridge Loan?
Bridge loan lenders tend to pay less attention to a borrower’s creditworthiness than a traditional lender would. Your bridge lender will be more interested in property value, as the property will be used as collateral on the loan.
This means that a bridge loan may be appropriate if you have encountered issues trying to secure a traditional loan. It may also be suitable for investors looking to use a loan to fund a fix and flip project or purchase a new property for rental.
How To Find a Bridge Loan Lender in Florida
Bridge loans are not available from the same places you procure a conventional mortgage; instead, you require a direct bridge lender. These lenders can be individual private investors or small businesses like Lightspeed Lending.
It is important to take your time to research the best provider to make your loan successful. Each provider will have different qualifying criteria and different terms and conditions for their loan product.
Conduct research on the various vendors to learn what the minimum credit score requirements are, what the minimum and maximum property values are, and what level of loan to value (LTV) is available.
Is a Bridge Loan Worth it?
So now that you know the details of what a bridge loan is, is it something you should consider? While they are not for everyone, when used correctly they can help improve your profit margins significantly.
Bridge financing is perfect for property developers who want to buy and flip property in near-term future.
Pros of Bridge Loans
Some advantages include:
- Bridge loan lenders offer loans that typically close faster than a traditional loan. Traditional banks need a great deal of information with regards to your personal financial situation, bridge loan lenders do not. Traditional lenders are usually banks and large financial institutions that have complex processes, layers of corporate bureaucracy, and a challenging approval process. The bottom line: bridge loans are faster than a bank loan because you have fewer hoops to jump through.
- Bridge loan lenders are usually specialized lenders that focus specifically on this type of lending, making it easier and quick to approve the fast financing.
- Bridge loan lenders do not put as much emphasis on the borrower’s credit score. This is because the loan is secured against an asset or new house purchase. They are not tied down by the same regulations as conventional loan lenders.
- With bridge financing, you can avoid private mortgage insurance.
- There are typically no early repayment fees, meaning you can pay early with a lump-sum payment.
- Flexible underwriting requirements.
- In some cases, no monthly mortgage payments are required! While some lenders may ask for interest-only payments to be made monthly, many prefer lump-sum interest payments at the end of the loan term.
Cons of Bridge Loans
Some of the cons of bridge loans include:
- Bridge loans typically have high interest rates compared to traditional loans. However, the practicality and efficiency of a bridge loan will generally justify high bridge loan rates to a borrower.
- Transaction costs and closing costs may also be higher for a bridge loan. Closing costs can add up to a few thousand dollars, alongside an origination fee. While the fees may vary between bridge loan lenders, you can expect to have to pay origination fees at the very least.
Are There Any Alternatives to Bridge Loan Funds?
While bridge loans present an attractive solution for securing finance for your purchase, there are different options available that you may wish to consider:
- Unsecured lending: borrowing money on credit cards, a personal loan, or bank overdraft is a possibility. These types of unsecured borrowing and personal loan options are usually provided by banks or financial businesses and often rely on the borrower’s credit rating, but the rate is often capped and demands higher interest-only/high-interest rates over a very short period.
- Refinancing: refinancing any existing investment property, or opting for a home equity loan or a home equity line of credit might release equity to be used in a future purchase. However, home equity loans and refinancing processes can incur expensive additional fees, including solicitor expenses, valuation fees, and arrangement fees. Additionally, a home equity loan is secured with your existing residence.
Whatever option you choose it is important to consider the total cost of your finance solution in addition to the loan value before you commit to it.
Bridge Loan Rate and Down Payment: What Should I Expect?
Bridge loans differ significantly from traditional financial institutions because they typically offer interest rates from 10% to 15% but only a loan-to-value (LTV) ratio of 50% to 60%, thus requiring a higher down payment. This is significantly lower than traditional lending, making bridge loans a great option for short-term cash injections. With providers like Lightspeed Lending, the LTV can go as high as 80%, reducing your down payment and making the proposition even more desirable.
It is important to remember that the interest rate offered can vary for several reasons. Geography plays an important role because the loan is secured against the property so always consider the location and appeal of the property. You don’t need a great credit score or to supply your entire family history to be considered. Bridge loans are easy and as a result, the rates are a little higher because of the greater risk to the lender.
The is no minimum credit score needed for a bridge loan, but other loan types require a minimum 600 FICO score.
Are Bridge Loans a Good Idea?
As with all financial products, there are advantages and disadvantages to each one. The suitability of a bridge loan depends on numerous factors. We already know that bridge loans have a fast turnaround, flexible terms, and robust approvals amounts, but are there any disadvantages of a bridge loan?
Many bridge loan lenders only offer short-term loans and the down payment needed varies between the providers and the lending services provided. The interest rates are normally higher than a traditional mortgage because of the higher risk to the lender which means the closing costs might be higher.
The payoff occurs when a cash injection is needed and the borrower intends to pay off the bridge loan quickly – this way bridge loans have a distinct advantage.
Who We Are
We are FAST lenders for those who want to borrow money for residential bridge loans, fix & flip loans, rental loans & construction loans. The key is we get you money faster and more cost effectively then anyone else.
About Lightspeed Lending
Lightspeed Lending is a private money lender located in Boca Raton, Florida. Lending services provided by Lightspeed Lending cover all areas of bridge loan lending such as residential bridge loans, fix and flip loans, rental loans, and construction loans. We can also refinance existing investment loans.
Andrew Weissman, Lightspeed Founder, and President
Lightspeed Founder and President, Andrew Weissman, has vast knowledge and experience within the real estate investment and residential bridge loan sector. Andrew strives to offer all of his clients a lending service that is fully tailored to meet their individual needs.
Andrew’s expertise and reliable advice will help you to negotiate seamlessly through the process of securing a bridge loan.
How Can Lightspeed Lending Help You?
To compete in the current seller’s market, speed is essential. Lightspeed Lending offers quick and efficient access to the capital needed. By working with us, you can bypass broker fees, as we process, underwrite, and close all of our loans in-house.
We also strive to establish a lasting relationship with all of our clients, so that any future funding processes can be handled even more efficiently!
Many lenders will offer hard money loans to refinance various solutions for the client, so how do you choose the right lender for you? While interest rates are important, that is not the only consideration.
At Lightspeed Lending we are famous for our excellent customer experience, our efficiency, and unparalleled customer support, we will be there for you when you need us. Unlike other lenders, at Lightspeed Lending we don’t adhere to strict office hours instead, we tailor our customer service to meet the demands of our individual clients. With efficiency being such an important part of the service that we offer here at Lightspeed Lending, we are always available at the end of the phone.
We Offer Unparalleled Customer Service
Our real estate investors provide us with fantastic reviews about our loan programs and the excellent service that they receive from us. Find out some of the reasons why they love us below: