Bridge loan

Definition

Short-term money that funds a gap until permanent capital lands.

Why It Matters

At searcher scale it appears rarely and pointedly. It covers an equity shortfall for a few weeks, or holds a deal together while an SBA package finishes. The money is priced for speed, so it earns its cost only against a hard, near-term takeout you can name before you borrow.

In numbers: A $200,000 bridge carried for 90 days at 12% costs about $6,000 in interest, which is cheap against losing exclusivity and expensive if the takeout slips to nine months.