A bridge loan is defined as a short-term loan used by a business for financing immediate obligations or needs. These loans allow the borrower to meet their current financial obligations by getting capital quickly for payroll, taxes, rent, even additional inventory.
Bridge loans are called ‘short-term’ because they are usually only up to a year. These types of loans can sometimes be called working capital loans or bridge financing. But whatever you call them – they are one of Probably’s specialties!
How Do Bridge Loans Work?
Bridge loans bridge a financial gap when financing or working capital is needed for your business but not yet available. Both large corporations and small businesses can use bridge loans, which means that your particular loan should be customized for your needs, amount, and situation.
Bridge loans are fast options and can provide immediate working capital, but this can come with higher interest sometimes and may require collateral. This is why it is important to get terms that benefit you, work with a transparent lender, and make sure you understand the process and repayment details.
Differences Between Bridge Loans & Traditional Loans
|Bridge Loans||Traditional Loans|
|Shorter application||Longer application|
|Faster approval||Slower approval|
|Short-term funding||Longer-term funding|
|Sometimes higher interest rates||Sometimes lower interest rates|
|No repayment penalties||May have repayment penalties|
Bridge Loans for Your Small Business
Bridge loans are not like payday loans or other ‘get funding fast’ options for individuals, instead, they help a business make more money, grow, or become more successful.
For example, if a small business gets a large order, then they will need to buy extra inventory, products, or parts to fill that order. And though they have not been paid for the order they are about to make, they still need the working capital to buy the items to fill the order. That kind of circular funding problem happens quite often for small businesses, and a bridge loan is the perfect, short-term solution!
Bridge loans can also be used for short-term payroll, rent, utilities, and other expenses that will help your business in the long run, or ‘hold you over’ until you can secure longer-term financing.
Our Bridge Loan Uses:
Help with Payroll
When you need working capital for payroll, speed, and ease matter. Your employees depend on you and your payroll, and you can depend on Probably to get you the working capital you need quickly with our bridge loans.
Invest in New or Supplementary Equipment
Buying new equipment (or more equipment for added demand) can be a big investment, but sometimes you need to spend money to make money. If you need a bridge loan to invest in equipment that will help your business thrive, we’ve got you covered – fast.
Pay Taxes or Infrequent Financial Obligations
Sometimes financial obligations and fees pop up when you least expect them, and sometimes taxes or quarterlies add up faster than you planned on. Use our small business bridge loans to pay for the surprises on your road to success.
Purchase Additional Inventory for Spikes or Large Orders
Additional inventory might be needed when you don’t quite have the capital on-hand for a big order or a heightened demand. Use a working capital or bridge loan to bridge the gap and get your inventory so you can keep your business moving forward!
Invest in Your Marketing Services
Marketing, whether in print, online, radio, or on TV, can be expensive. If your marketing efforts need to be bumped up during certain times of the year, then you’ll need a short time influx of working capital to set you up for great ROI. Have the capital you need for a killer campaign with our bridge loans!
General Help with Cash Flow
If this year has shown us anything, it’s that small businesses have slow and busy periods that they may have no control over, but that doesn’t mean your bills have slow and busy periods – they steadily keep coming! Use our bridge loan to help with your cash flow at any time of the year, until you can bounce back or secure longer-term financing.