Private Money Hawaii
What is a Bridge Loan?
Benefits for Hawaii Real Estate Investors
Navigating the competitive Hawaii real estate market demands speed, flexibility, and access to reliable capital. That’s where bridge loans come in.
A bridge loan is a short-term financing solution designed to “bridge the gap” between the purchase of a new property and the sale of an existing one. These loans are particularly attractive for real estate investors in Hawaii, where opportunities can vanish quickly if not acted on immediately.
How Bridge Loans Work in Real Estate
Bridge loans typically have terms ranging from 6 to 12 months and are secured by collateral, usually the property being purchased or another asset. Borrowers use these loans to:
- Secure time-sensitive investment properties
- Renovate and flip homes before refinancing or reselling
- Fund purchases while waiting for long-term financing or sale proceeds
Unlike traditional loans, bridge loans prioritize asset value over personal credit scores, making them faster to approve, a critical advantage in Hawaii’s fast-moving property markets.
Who Should Consider Bridge Loans in Hawaii?
- Fix-and-flip investors needing fast capital for renovations
- Buy-and-hold investors waiting on long-term financing approval
- Real estate developers acquiring land or teardown properties
- Second-home buyers who haven’t sold their current home yet
Benefits of Bridge Loans for Hawaii Real Estate Investors
1. Speed of Execution
In Hawaii’s hot real estate zones like Honolulu, Maui, and the Big Island, investors often face fierce competition. Bridge loans allow them to close deals in days rather than weeks, often faster than buyers using conventional mortgages.
2. Flexible Underwriting
Most private bridge lenders focus more on the property’s value and investor experience than on credit scores or W-2 income. This appeals especially to self-employed investors or those working multiple flips.
3. Leverage and Growth Potential
Bridge loans give investors the ability to purchase a new property before selling an existing one, helping them grow their portfolio faster without liquidating other assets too soon.
4. Renovation-Focused Lending
Many bridge loans come with construction or rehab funding built in. This is ideal for fix-and-flip investors in Hawaii looking to renovate outdated or distressed properties.
5. Creative Deal Structuring
Bridge financing can be structured to match unique deal requirements — interest-only payments, delayed payments, or balloon payments — based on project cash flow.
6. Competitive Advantage in a Seller’s Market
Being a “cash-equivalent” buyer with bridge financing in place puts investors in a stronger negotiating position, often leading to better pricing or acceptance of offers over financed buyers.
Typical Terms, Rates & Requirements
Loan Duration & Interest Rates
Bridge loans generally have terms of **3 to 18 months** with interest rates in the range of **8% to 12%**, depending on island, location, and risk profile.
LTV & Down Payment
Many lenders allow up to **65–75% LTV**, meaning borrowers must bring 25–35% equity. More challenging properties (leasehold, remote) may require more equity.
Fees, Points & Draws
Origination fees (1–3 points) are common. Funds may be disbursed as lump sum or phased draws if improvements are needed. Some lenders retain a reserve until project completion.
Risks and Considerations
Bridge loans carry higher interest rates (typically 7%–12%) and fees compared to traditional mortgages. It’s crucial for investors to:
- Have a clear exit strategy (sale or refinance)
- Understand repayment terms and penalties
- Partner with reputable Hawaii bridge lenders
Bridge Loans vs. Hard Money Loans
While both are short-term financing, bridge loans often emphasize flexibility to transition to long-term loans. Hard money loans are asset-based and may be more rigid in structure—both have their place depending on deal strategy.
Use Cases in Hawaii Real Estate
– Instant acquisition of a Honolulu condo while awaiting long-term financing – Land development stages where infrastructure is built, then replaced with mortgage – Financing rehab before long-term rental or resale
Local Considerations in Hawaii
– Leasehold vs fee-simple properties – Zoning & permitting timelines – Island logistics (shipping, contractors) – Market risk based on location (Waikiki, Maui, Big Island)
FAQs About Bridge Loans in Hawaii
Can bridge loans be converted to long-term financing?
Often, yes—many investors refinance into mortgages, DSCR, or conventional loans.How fast can I access bridge funding?
In many cases, funding can occur in 7–14 business days with full documentation prepared.Final Thoughts
For experienced real estate investors in Hawaii, a bridge loan can be the difference between securing a prime property or watching it go to a faster buyer. By offering short-term capital with flexible terms, bridge loans empower investors to act decisively, especially in Hawaii’s competitive and often time-sensitive property market.Offering Rates Starts at 9%
Ready for a Honolulu Hard Money Loan? Fast, Flexible Financing Across Hawaii
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Secure funding in as little as 7–14 days. No bank delays—just Honolulu hard money loans designed for investors who need speed and certainty.
Tailored Loan Programs
From fix-and-flip loans in Oʻahu to bridge loans in Honolulu, DSCR rental financing, and construction loans across Hawaii, we customize terms around your project’s needs. With interest-only payment options, LTV up to 70%, and clear origination fees, you’ll have flexible funding that works for you.
Local Expertise You Can Trust
Led by veteran lender David Ige, with nearly 30 years of experience funding Hawaii investment property loans, we combine deep local insight with transparent terms to help investors succeed.
Private Money Hawaii
Address: 411 Hobron Ln #3912, Honolulu, HI 96815
Call: +1(808) 753-1204
Email: funding@privatemoneyhawaii.com