Bridge Loans vs. Hard Money: Which One Should You Use?
Bridge loans and hard money sit in the same neighborhood, but they're not the same loan. Here's how to choose the right short-term capital for your next deal.
Investors often use the words 'bridge' and 'hard money' interchangeably. They shouldn't. Both are short-term, asset-based, and faster than a bank — but the underwriting box, the pricing, and the use case are different.
Bridge loans
Bridge loans are designed for stabilized or near-stabilized assets where the exit is clearly defined — usually a refinance into permanent debt or a sale. Pricing is closer to institutional, the asset class is broader (including small multifamily and commercial), and term lengths run 12–36 months.
Hard money
Hard money historically described high-rate, short-duration capital from private lenders for heavy rehab or distressed deals where speed matters more than rate. Modern hard money looks a lot like a fix-and-flip loan and is best for residential value-add projects.
How to choose
- Stabilized asset with a refi exit → bridge
- Distressed or heavy-rehab 1–4 unit → hard money / fix-and-flip
- Multifamily reposition with a 24-month business plan → bridge
- Auction or off-market deal that has to close in 10 days → either, whichever quotes fastest
What both share
- Asset-based underwriting — credit and income matter less than the deal
- Faster closes (7–21 days) than bank debt
- Higher rates and points than long-term financing
- Interest-only payments with a balloon at term
Tell us the asset and the exit — we'll have a term sheet inside 24 hours.
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