Durham sees two kinds of large residential bridge deals: high-value homes in neighborhoods like Hope Valley, Forest Hills and Trinity Park, and packages of new infill duplexes and townhomes from builders who need to sell or refinance on a deadline.
In short: LendingStreet offers residential investor bridge loans from $1M to $5M+ in Durham, within a program range of $150,000 to $5M+. Rates start from 7.99%, closings can happen in as little as 10 days, and loans are short-term and interest-only on 1 to 8 unit properties. Larger balances usually need a full valuation. Typical exits are a DSCR or jumbo DSCR refinance once the properties are leased, or a sale.
Durham's growth has pushed many close-in properties well past what a small bridge loan covers. Investors use large bridge loans to buy groups of new infill duplexes in East Durham and Old North Durham, to take out a builder's maturing construction loan on finished units that still need tenants, and to buy high-value homes in Hope Valley, Forest Hills, Trinity Park and near Duke Forest for use as executive rentals.
Some deals are about time. An estate selling several rentals, a 1031 buyer with a fixed deadline, or a seller who wants a quick, certain close can all favor bridge money over a slower long-term loan.
Bridge loans are short-term and interest-only. Rates start from 7.99%, and pricing on large balances is set case by case. Closings can happen in as little as 10 days with a complete file.
Larger balances usually need a full valuation. For new construction, appraisers want final inspections and certificates of occupancy, plus a rent schedule for the units.
This example is illustrative and not a quote. An investor buys four newly finished duplexes in East Durham from a builder for $2,280,000. None are leased yet. A bridge loan at 75% of price is $1,710,000, with estimated interest-only payments of about $13,538 a month during lease-up.
Within a few months all eight units lease at about $1,850, or $14,800 a month, and the four buildings appraise at $2,400,000. A DSCR refinance at 65% of value, $1,560,000, paired with some of the investor's cash, pays off the bridge.
Estimated principal and interest on the new loan is about $10,642. With $1,900 of taxes on the finished value and $700 of insurance, the payment is about $13,242, and the DSCR is about 1.12x.
| Stage | Amount |
|---|---|
| Purchase price (4 duplexes) | $2,280,000 |
| Bridge loan at 75% | $1,710,000 |
| Estimated interest-only payment | $13,538 |
| Appraised value once leased | $2,400,000 |
| DSCR loan at 65% | $1,560,000 |
| Estimated principal and interest | $10,642 |
| Taxes and insurance | $2,600 |
| Combined rent | $14,800 |
| DSCR | About 1.12x |
Durham's prices are high relative to rents. That shows up at the exit: a property can appraise well and still not support a large long-term loan, because the rent has to cover principal, interest, taxes and insurance at the program minimum. In the example, the investor pays down part of the bridge at refinance rather than stretching the ratio.
Plan for this before you buy. Run the refinance at a few loan sizes using realistic rents, and know how much cash you will need to bring if the rent supports less than the bridge balance.
Another option is to sell one or two buildings from a package to retail buyers and use the proceeds to pay the bridge down, then refinance the rest at a size the rent comfortably supports. Partial releases on the bridge loan make that possible; ask how they are priced before you close.
Builders and investors who financed infill projects with construction loans often face a maturity date before the units are leased. A bridge loan can pay off the construction lender and carry the property through lease-up. New units are assessed at their finished value, so budget taxes on that number, not on the land-only bill shown before construction. Have final inspections, certificates of occupancy and the builder's warranty documents ready, since both the bridge and the later DSCR lender will ask for them.
Larger homes in Hope Valley, Forest Hills and Duke Forest lease to executives, physicians and visiting faculty. A bridge loan can secure the purchase quickly, and a jumbo DSCR loan can follow once the home is leased. Rents on these homes can be strong, but appraisers may find few comparable leases, so bring evidence of what similar homes rent for.
These homes also tend to carry larger tax bills after revaluation and higher insurance on big roofs and older systems. Test the jumbo exit with those figures, not with the rent alone.
North Carolina closings are handled by an attorney. The state excise tax on deeds, $1 per $500, is customarily paid by the seller. Durham County's revaluation raised many assessed values, so use current bills when testing the exit, and add the City of Durham tax for properties inside city limits.
New duplexes can be refinanced individually or, if there are five or more properties, together on a blanket loan with release provisions. A single high-value home exits into a jumbo DSCR loan. Some investors sell part of a package to builders' retail buyers and keep the rest. Our bridge-to-DSCR guide covers seasoning and timing.
Our investor loans are business-purpose loans on non-owner-occupied property. Send the property list, price, status of permits and certificates of occupancy, expected rents and your planned exit. LendingStreet will size the bridge and test the refinance at a few loan amounts. Call (877) 298-1001 or use the form below. See also our North Carolina large bridge page.
Packages of new infill duplexes and townhomes, construction loan payoffs during lease-up, and high-value homes bought as executive rentals.
Rates start from 7.99%. Pricing on large balances is set case by case.
Larger balances usually need a full valuation, and new construction needs final inspections and certificates of occupancy.
Durham rents are low relative to prices, so the DSCR loan the rent supports can be smaller than the bridge balance.
Yes, if the units are finished. The bridge can carry the property through lease-up before a DSCR refinance.
In as little as 10 days with a complete file. Packages and new construction can take longer.
Yes. Bridge financing can help a 1031 buyer close on a fixed deadline. Coordinate the timeline with your qualified intermediary and closing attorney.
Yes, with five or more properties a blanket portfolio loan can combine them with release provisions.
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