bridge loan

  

Definition

Short-term (usually one to three months) loan advanced to cover the period between the termination of one loan and the start of another. It is arranged generally to complete a purchase (such as a new house) before the borrower receives payment from a sale (of the old house), or before a long-term loan is made available upon fulfillment of its requirements (such as commissioning of a facility or a plant). Also called bridge finance, bridging loan, or gap financing.

Use bridge loan in a sentence

  • If you find a loan running out and need a little more in the short term you may need to undergo another bridge loan.

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  • If you find yourself in the position to need a bridge loan you will need to make sure that they don't take advantage of your situation.

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  • When my home construction is completed I will need a bridge loan until I am approved for a traditional mortgage.

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