Multifamily bridge loans

What lenders look at

Rent roll and T-12

Lenders tie the current rent roll to the trailing 12-month operating statement and bank deposits. Concessions, delinquency and non-revenue units get backed out, so in-place income is often lower than the broker package suggests.

Unit mix and loss-to-lease

The gap between in-place rents and current market rents for each unit type is the core of most value-add stories. Lenders check it against rent comps from the appraisal, not the pro forma.

Deferred maintenance

Roofs, HVAC, plumbing (especially older galvanized or polybutylene supply lines), electrical panels and down units. Heavy deferred maintenance usually means a holdback or a lower as-is advance.

Submarket rents and supply

New deliveries nearby can cap rent growth and slow lease-up. Lenders look at whether renovated-unit premiums are realistic for the submarket.

Property management

Who manages the asset and their track record with this unit count and class. Self-management on a larger property gets more scrutiny.

Insurance

Coverage, deductibles and premium trend, particularly in wind, hail, flood and wildfire areas, where insurance cost can change the debt service picture on its own.

How leverage works

Many asset-based bridge lenders cap multifamily leverage around 65–75% of as-is value. When there is a renovation budget, lenders often size to loan-to-cost and fund rehab draws from a holdback, with the total loan also limited by a percentage of the after-repair or stabilized value. Leverage tends to drop when physical occupancy is low, collections are weak, the property has significant down units, or the asset is in a tertiary market. Lenders that don't pull credit or verify income usually offset that with lower leverage.

Use the commercial bridge loan sizer to see whether LTV or LTC decides your loan. The deal form asks for units, occupancy today and current NOI, so lenders see the numbers they size on.

Documents lenders ask for

• Current certified rent roll
• Trailing 12-month operating statement (T-12) and prior-year financials
• Bank statements or deposit history supporting collections
• Purchase contract or current loan payoff statement
• Renovation budget and scope by unit and common area
• Current insurance declarations and loss runs
• Property management agreement and manager resume
• Utility bills and any RUBS or submetering details
• Entity documents and sponsor real estate schedule
• Photos or a recent property condition report, if available

How fast it closes

Multifamily bridge loans commonly close in about 14–30 days, and some asset-based lenders can move faster on a clean file. The appraisal is usually the longest item, followed by the property condition report and Phase I environmental, which many lenders require above a certain loan size. A survey and zoning report may be required on larger assets. Files slow down when the rent roll doesn't reconcile with the T-12, when units can't be accessed for inspection, or when insurance has to be re-quoted.

Common bridge scenarios

Value-add acquisition

Buy an underperforming property, fund unit interiors and exterior work from a rehab holdback, and push rents toward market.

Lease-up after renovation

Refinance a property that has finished work but hasn't reached stabilized occupancy, buying time to season income.

Maturing loan payoff

Pay off a bank or bridge loan that matures before the property qualifies for permanent debt.

Bridge to agency

Hold the asset on bridge debt until occupancy and trailing income meet agency or HUD standards, then refinance.

Typical exit

Most multifamily bridge loans exit to agency (Fannie Mae or Freddie Mac), HUD 223(f), a bank or credit union loan, or a sale once the property is stabilized.