Commercial Real Estate
Bridge vs Permanent Loan: Structuring the Exit
A bridge loan is short-term capital used to acquire or reposition a property, repaid by a sale, refinance or permanent loan. A permanent loan is the long-term debt you hold. The critical decision is the exit — know how and when the bridge gets taken out before you close it.
Bridge — speed and flexibility
Bridge financing closes fast and tolerates properties that are not yet stabilized, including value-add plans and delayed seller situations.
Permanent — the destination
Permanent debt is sized on stabilized income, so lenders want occupancy, leases and clean operating statements.
Plan the exit
- Set a realistic stabilization timeline
- Confirm permanent-loan eligibility early
- Budget the interest carry for the bridge period
Frequently asked questions
How long is a bridge loan?
Commonly 6–36 months, depending on the project.
When should I start the refinance?
Early — well before the bridge matures.