Description
A bridge loan is interim financing for an individual or business until permanent or the next stage of financing can be obtained. Money from the new financing is generally used to "take out" (i.e. to pay back) the bridge loan, as well as other capitalization needs.
Bridge loans are typically more expensive than conventional financing to compensate for the additional risk of the loan. Bridge loans typically have a higher interest rate, points and other costs that are amortized over a shorter period, and various fees and other "sweeteners" (such as equity participation by the lender in some loans). The lender also may require cross-collateralization and a lower loan-to-value ratio. On the other hand they are typically arranged quickly with relatively little documentation.
Read more about this topic: Bridge Loan
Famous quotes containing the word description:
“The type of fig leaf which each culture employs to cover its social taboos offers a twofold description of its morality. It reveals that certain unacknowledged behavior exists and it suggests the form that such behavior takes.”
—Freda Adler (b. 1934)
“I fancy it must be the quantity of animal food eaten by the English which renders their character insusceptible of civilisation. I suspect it is in their kitchens and not in their churches that their reformation must be worked, and that Missionaries of that description from [France] would avail more than those who should endeavor to tame them by precepts of religion or philosophy.”
—Thomas Jefferson (1743–1826)
“Do not require a description of the countries towards which you sail. The description does not describe them to you, and to- morrow you arrive there, and know them by inhabiting them.”
—Ralph Waldo Emerson (1803–1882)