What are the requirements for a bridge loan?
A bridge lender typically requires a documented exit plan, a credit score around 650 or higher, 20 to 35 percent equity in the deal, three to six months of interest in reserves or an interest reserve inside the loan, and a property whose current or projected value supports 65 to 80 percent leverage. Experience helps but is not required for lighter projects.
The checklist
| Requirement | Typical standard |
|---|---|
| Exit plan | Sale comps, a permanent loan pre-qualification, or a stabilization plan with a timeline |
| Credit score | 650 and up; some lenders 620 with more equity |
| Equity | 20 to 35 percent of cost, depending on condition and leverage |
| Reserves | 3 to 6 months of interest, or an interest reserve funded from the loan |
| Property | Appraisal supporting current value and, for value-add, the completed value |
| Experience | Helpful for heavy rehab; not required for light work or buy-before-sell |
| Entity | LLC vesting accepted and usually preferred |
| Insurance | Property and liability, builder's risk if renovating |
Ranges vary by lender.
What the lender reads first
The exit. A bridge lender asks how they get paid back before anything else. "I will refinance into a DSCR loan" is a plan only if the projected rent covers that loan's payment and your credit qualifies for it. Bring the numbers.
The value. Two appraisals matter on a value-add deal: as-is and as-completed. Leverage is set against both, and the lower limit controls.
Liquidity. Bridge lenders want to see that you can carry the property if the timeline slips. Reserves after closing of three to six months of interest is common; more for construction.
Your history. Prior projects of similar size, or a general contractor and property manager who have them.
Documents to expect
- Application and personal financial statement.
- Two months of bank and brokerage statements.
- Purchase contract or current mortgage statement.
- Scope of work and budget for any renovation.
- Rent roll and leases if occupied.
- Entity documents for the LLC.
- Track record: addresses and outcomes of past projects.
- Exit support: comps, a term sheet or pre-qualification for the permanent loan, or a listing plan.
Common reasons for a decline
- No credible exit, or an exit that depends on rents or values well above market.
- A property in a condition the lender does not finance, such as no roof or structural damage.
- Thin liquidity with no interest reserve.
- Recent mortgage lates or an unresolved bankruptcy.
- A market the lender does not cover.
How CommFi handles it
One application covers the bridge loan and the exit. Our lending desk prices it first and funds direct when it fits. When the file needs a lender that works with lighter experience or a specific property type, the desk searches a database of 7,000+ lenders and the ones that fit compete for it. Zero upfront fees.
Related reading
Related questions
- What credit score do I need for a bridge loan?
- Around 650 with most bridge lenders. Some go to 620 with more equity, and hard money is the alternative below that.
- How much equity do bridge lenders require?
- Typically 20 to 35 percent of cost, depending on property condition and how much of the renovation budget is financed.
- Do I need experience to get a bridge loan?
- Not for buy-before-sell or light renovation. Heavy rehab usually needs prior projects or an experienced contractor on the team.
- What is an acceptable exit for a bridge loan?
- A sale supported by comps, a refinance you qualify for today, or a stabilization plan with realistic rents and a timeline.
- Does a bridge loan require an appraisal?
- Usually a full appraisal, and on value-add deals an as-completed value as well.
Property developer and licensed appraiser. 22+ years in real estate: TIC conversions, multi-unit redevelopments, mixed-use, fix and flips, commercial DSCR.