In the fast-paced world of real estate investing and property acquisition, timing is everything. Whether you are looking to secure a new primary residence before selling your old one or an investor aiming to renovate a commercial asset, you likely need capital—fast. This is where a bridge lender becomes your most valuable partner.
Modern luxury residential home financed by a bridge lender
In this guide, we will break down what bridge loans are, how they are used, and how they stack up against traditional mortgage products like QM and Non-QM loans. We will also provide a deep-dive analysis of the bridge loan options available at Capital Funding.
A bridge loan is a short-term financing tool (typically 6 to 36 months) designed to “bridge the gap” between an immediate need for capital and a long-term financing solution or a liquidity event (like the sale of a property).
Unlike traditional mortgages, bridge loans are asset-based. This means the lender cares more about the value of the collateral (the property) and the exit strategy than your personal debt-to-income (DTI) ratio or standard W-2 income documentation.
Buying Before Selling: Homeowners use bridge loans to tap into the equity of their current home to fund a down payment on a new one.
Property Stabilization: Investors use them to purchase “non-stabilized” properties (those with low occupancy or in need of repair) that traditional banks won’t touch.
Fix and Flip: Real estate investors use bridge financing to purchase and renovate distressed properties quickly.
Commercial Acquisitions: Businesses use them to seize time-sensitive opportunities while waiting for permanent commercial financing.
Understanding where a bridge loan fits into the broader lending landscape is crucial for managing your cost of capital.
Alt Text: Business professional analyzing mortgage loan options on a laptop
Title: Comparing Bridge Loans and QM Loans
QM Loans are your standard conventional loans (Fannie Mae/Freddie Mac). They offer the lowest interest rates and 30-year terms but come with “red tape.”
The Difference: A bridge lender focuses on speed and equity; a QM lender focuses on your tax returns, high credit scores, and strict DTI limits. Bridge loans close in days; QM loans close in 30–60 days.
Non-QM Loans are designed for borrowers who don’t fit the “standard” mold—such as self-employed individuals using bank statements instead of tax returns.
The Difference: Non-QM loans are still long-term (15–30 years). Bridge loans are strictly short-term. If you need a permanent solution but have unique income, Non-QM is better. If you need to renovate and sell within a year, a bridge loan is the way to go.
A Home Equity Line of Credit (HELOC) allows you to borrow against your current home’s equity.
The Difference: HELOCs are second liens and usually have variable rates. While they are cheaper than bridge loans, many lenders won’t let you use a HELOC if your current home is already listed for sale. A bridge loan is specifically designed for that transition.
When searching for a bridge lender, Capital Funding stands out as a nationwide, direct private money lender. Because they are backed by a family office with discretionary capital, they offer a level of flexibility and speed that many institutional lenders cannot match.
Alt Text: Large commercial office building suitable for a commercial bridge loan
Title: Capital Funding Commercial Bridge Loans
Commercial Bridge Loans: Ideal for value-add or non-stabilized commercial assets. Capital Funding can move as fast as the deal requires, often closing in just a few days.
Residential Hard Money: Perfect for fix-and-flip investors. They fund both the purchase and a portion of the renovation costs.
Primary Residence Bridge: Unlike many private lenders who only do “investment-only” deals, Capital Funding has programs for primary residences where speed is the priority.
No Red Tape: They focus on the asset. If the equity is there and the exit strategy is clear, they can often fund deals that traditional banks have rejected.
Their “Broker Friendly” approach and nationwide reach make them a top-tier choice for complex, high-stakes transactions. Whether it’s a $45M luxury acquisition in Los Angeles or a $2.5M short-term rental in South Carolina, their track record proves they can handle scale and speed.
If a bridge loan isn’t the right fit due to the higher interest rates (usually 8%–12%), consider these alternatives:
Cross-Collateralization: Using equity in multiple properties you already own to secure a lower-rate loan.
Personal Loans/Lines of Credit: Best for smaller gaps ($50k or less).
Seller Financing: Negotiating with the seller to hold a portion of the purchase price as a second mortgage.
Ready to start your next project? Apply for a Bridge Loan with Capital Funding today.
