Bridge Financing
Bridge financing for healthcare and multifamily
Acquisition deadlines and maturing loans can arrive before a property is ready for permanent financing. LMD provides direct bridge capital and arranges senior financing, depending on the transaction, so you can evaluate current operations, the business plan and the potential refinancing together rather than one at a time.
- Direct bridge capital or arranged senior financing, by transaction
- Acquisitions, maturities, stabilization and selected capex
- Exit reviewed alongside the bridge request
- Timing set by diligence, third-party reports and approvals
Fit
When bridge financing fits
Bridge capital is short-term by design. It is most useful when there is a clear reason the property cannot yet support, or qualify for, its long-term loan.
Acquisitions
Closing on a skilled nursing, assisted living or memory care purchase before a permanent lender can underwrite the new operator's performance.
Maturities and refinancing
Replacing a maturing bank or bridge loan when the property needs more operating history before a permanent refinance.
Operating stabilization
Time to rebuild census, improve payer mix, settle staffing or complete an operator transition.
Selected capital improvements
Funding defined capex that supports the business plan, where the scope and budget are documented.
Healthcare
Bridge-to-HUD for SNFs, ALFs and memory care
For many skilled nursing facilities (SNFs), assisted living facilities (ALFs) and memory care communities, the intended long-term loan is an FHA-insured HUD Section 232 refinance. Bridge financing covers the period before that refinance can be pursued. LMD arranges HUD financing through applicable lending relationships.
A HUD takeout is a plan, not a certainty. It depends on program eligibility, underwriting, lender and HUD approvals, and execution. Read more on our FHA/HUD Section 232 and multifamily programs page.
Underwriting
How LMD evaluates the HUD exit
We look at the bridge loan and the expected refinance together, because the exit determines whether the bridge makes sense.
Current versus projected cash flow
Normalized trailing performance is compared with the business-plan projections, and we look at what has to change to get from one to the other.
Census, occupancy and payer mix
Trends in census and the mix of Medicaid, Medicare and private pay shape both revenue stability and refinance underwriting.
Staffing and expenses
Labor costs, agency staffing usage and other operating expenses are reviewed against the facility's size and acuity.
Debt service and valuation
Expected debt service coverage and valuation at refinance indicate how much permanent debt the property may support.
Eligible debt, reserves, costs and timing
Which existing debt a refinance may repay, required reserves, closing costs, and a realistic timeline for reports and approvals.
Multifamily
Multifamily bridge-to-agency
For conventional and affordable multifamily, bridge financing can support acquisitions, lease-up or value-add plans ahead of a Fannie Mae, Freddie Mac or FHA/HUD permanent loan. The same principle applies: the agency or HUD exit is reviewed alongside the bridge request and remains subject to that program's eligibility, underwriting and approvals.
Process
From preliminary review to closing
Preliminary review
Share the basics of the property and request. We give an initial read on fit and the key questions.
Financial and operating review
We review the financials, census and business plan, and outline a potential structure and exit.
Terms and diligence
If the transaction moves forward, terms are proposed and third-party reports, site visits and legal diligence begin.
Approvals and closing
Closing follows credit approval and documentation. Timing is specific to each transaction and depends on diligence, reports, licensing matters and the parties involved.
Documents
What to send for an initial review
- Property location and number of beds or units
- Purchase price or current debt
- Requested proceeds and closing deadline
- T-12 plus recent monthly financials
- Census or occupancy and payer mix
- Capex plan and business plan
- Operator and sponsor background
- Available license and survey information
FAQ
Bridge financing questions
Does LMD lend directly or arrange the loan?
Both, depending on the transaction. LMD provides direct bridge capital on some deals and arranges senior financing from other capital sources on others.
Is a HUD refinance guaranteed after the bridge loan?
No. A HUD takeout depends on program eligibility, underwriting, lender and HUD approvals, and execution. We evaluate the likely exit early, but no refinance can be promised in advance.
How long does a bridge loan take to close?
It depends on the transaction. Third-party reports, licensing and change-of-ownership matters, and the responsiveness of all parties drive timing. We will discuss a realistic schedule after the initial review.
What if the refinance does not fully repay the bridge loan?
Refinance proceeds can be lower than the bridge payoff, leaving a funding gap the sponsor may need to cover. We model this possibility upfront so it can be planned for.
Do you finance multifamily bridge loans too?
Yes. Multifamily bridge-to-agency and bridge-to-HUD transactions are reviewed the same way, with the permanent exit considered from the start.
Term Sheets
Download a branded PDF term sheet for any Bridge program.
Ready for a preliminary review?
Share the property, the request and your timing. Also see our mezzanine and B-note financing guide or FHA/HUD programs.