Bridge Loan Law and Legal Definition
A bridge loan is a short term interim loan used until securing a permanent financing or removing an existing obligation. It is a loan to bridge the gap between the termination of one mortgage and the beginning of another. A bridge loan is also known as a swing loan. The loan allows a customer to meet current obligations by providing immediate cash flow. Individuals and corporations are equally benefited from bridge loan. Individuals use this facility to bridge the time period between buying a new house and selling the prior one. A company doing a round of equity financing expected to close in a short time can use a bridge loan to secure working capital until the round of funding goes through.