Bridge Loans
2 Essential Lifelines That Help You Overcome Financial Timing Gaps
Bridge loans are an invaluable tool where you require funding partner support to help you with a strategic business initiative.
Merchant West provides short and medium-term bridge loans for cash flow timing differences.
These can be required due to the result of a strategic asset purchase or business expansion where working capital is temporarily not available. At Merchant West we look at bridge loans on a deal specific qualifying criterion, tailoring solutions to your needs.
Short-term bridge loans
Our short-term bridge loans help business’s cover immediate cash flow needs due to timing issues between revenue received and business expenditure. The key points for those businesses needing a short term bridge loan are:
- To qualify clients will need to demonstrate strong cash flows, a robust balance sheet, and a sound business model.
- Security taken is deal specific and typically reflects a combination of transactional and supplementary security, appropriate to the risk of the transaction.
- Interest is paid monthly, with capital repayments benefitting from being structured in line with the business’s cash flows and requirements
- The bridge loan term is up to 12 months.
- This is a non-revolving loan facility.
Medium-term bridge loans
We offer medium-term loans to clients with strong credit metrics, and where other lending products do not offer the required levels of flexibility. Key points include:
- Payments are made monthly or quarterly, and the loan is fully paid off by the end.
- Security requirements depends on the individual finance deal required.
- The loan term ranges from 12 to 60 months.
- This is a non-revolving loan facility.
Get Started Today
Ready to take your business to the next level? Contact Merchant West Working Capital Solutions today to learn more about how our bridge finance solutions can benefit you. Our financial experts are here to help you navigate your procurement needs and ensure your business remains financially strong and competitive.
Merchant West Working Capital Solutions is your go-to partner for securing financial stability and growth. Let us help you achieve your business goals with our tailored stock finance solutions.
Frequently Asked Questions
A bridge loan is a short-term or medium-term loan designed to provide quick access to funds to cover temporary cash flow gaps. This type of loan is typically used by individuals or businesses to secure immediate financing while they wait for more permanent funding solutions or to complete an anticipated event. Such events might include the sale of an asset, the closing of long-term financing, or the execution of a business transaction. The key advantage of a bridge loan is its ability to offer rapid financing, enabling borrowers to seize opportunities or manage urgent financial needs without delay.
Bridge loans are often used in business transactions to fill financing gaps. They provide essential short medium term funding during transitional periods. An example of where a bridge loan can be beneficial is when a company is purchasing new equipment but has not yet sold its old equipment, or when expanding operations but waiting for a long-term loan approval. Bridge loans can also be utilized when businesses face unexpected expenses, need to secure a property quickly, or are awaiting the influx of anticipated revenue. By offering immediate access to capital, bridge loans ensure that business operations continue smoothly without interruption, allowing companies to take advantage of strategic opportunities and maintain their growth momentum.
Bridge loans provide temporary funding, usually for a period of a few weeks to a few years. They are secured by transactional and supplementary security and are repaid when the borrower secures permanent financing or completes the anticipated event that the bridge loan was intended to finance.
Businesses with strong cash flows, solid balance sheets, and reliable business models are typically eligible for bridge loans. Creditworthiness and the specifics of the transaction also play a role. Consulting a Merchant West Working Capital Specialist will ascertain whether your business qualifies.
Bridge loans provide quick access to funds, help manage cash inflow and outflow timing gaps, and allow businesses to seize strategic opportunities without waiting for long-term financing.
Bridge loans typically have higher interest rates and shorter repayment periods. Failure to repay on time can result in additional fees or the loss of collateral.
To apply for a bridge loan, contact Merchant West. You'll need to provide details about your business’s financial health, the purpose of the loan, and any necessary documentation to demonstrate your ability to repay. Our expert Portfolio Managers will guide you through all the requirements and advise you on your most suitable options.
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Bridge Finance
Bridge Finance
