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Bridge Loans: Learn How to Increase Eligibility
If you've had a difficult time securing financing for your next commercial investment property because the property is half-occupied or it is in decrepit condition, you should consider the benefits offered by bridge loans. Learn why this type of financing might be the help that's right for you and some approaches to improve your eligibility. Conventional lenders don't like deserted or distressed properties. This isn’t the case with bridge lenders. Bridge lenders secure their loans based on a borrower’s experience and the potential of a property.
Bridge financing allows real estate investors to capture the long term and short term income potential of poorly-managed or distressed properties. Using bridge financing, an investor could purchase a half-occupied apartment complex, improve its condition, and increase occupancy. Once most of the units are occupied, the investor can then refinance to a conventional mortgage.
These loans also benefit developers who intend to resell distressed properties. The capital given by a bridge lender allows the investor to improve a property’s condition and then resell it for a tidy profit.
However, when it comes to bridge lenders, you need to do all in your power to prove the potential of your project and your experience as a developer.
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