Cap Tree Finance

Bridge Loans

A bridge loan is a type of short-term loan, typically taken out for a period of 2 weeks to 3 years pending the arrangement of larger or longer-term financing. It is usually called a bridging loan in the United Kingdom, also known as a "caveat loan," and also known in some applications as a swing loan.

A bridge loan is a short-term loan used until a person or company secures permanent financing or pays an existing obligation.

Overall, the main advantage of a bridge loan is its flexibility. It gives the borrower short-term capital to continue doing business uninterrupted. Borrowers can conduct regular business operations while waiting for a much more significant funding source to become available.

Bridge loans help in bridging the gap between short-term cash requirements and long-term loans. These loans are normally extended for a period of 12 months.