Portland's large bridge deals often start with a builder. Small developers who built duplexes, triplexes and fourplexes under the city's infill rules sometimes finish with a construction loan coming due and units not yet leased or sold. Investors who can close quickly step in, and a bridge loan covers the gap until the long-term financing is ready.
In short: LendingStreet's residential bridge loans run from $150,000 to $5M+, with rates from 7.99% and larger balances reviewed case by case. They are short-term, interest-only loans on 1 to 8 unit investment properties that can close in as little as 10 days, with exits by sale or refinance into a DSCR, blanket or jumbo DSCR loan. Larger balances usually need a full valuation.
Portland and its suburbs have plenty of properties above $1M, from completed middle-housing projects and small apartment buildings to high-value homes in the West Hills, Dunthorpe, Eastmoreland, Laurelhurst, Irvington and Lake Oswego. Large bridge loans here cover a range of situations.
Since the Residential Infill Project took effect, small builders have added thousands of units on single lots across Portland. Many financed them with short-term construction loans. When a project finishes in a slower leasing or sales market, the builder may need to refinance or sell quickly.
A bridge loan can buy the completed project or pay off the construction loan, giving time to lease. Once rents are in place, a DSCR or blanket loan is the long-term exit. Some builders keep part of a project as rentals and sell the rest, using sale proceeds to reduce the refinance amount.
This example is illustrative and not a quote. An investor buys two new fourplexes and a triplex, 11 units in all, from a builder in North and Northeast Portland for $3,850,000. A bridge loan at 70% of the price is $2,695,000, with estimated interest-only payments of about $23,581 a month during lease-up.
The units lease at an average of $1,950, or $21,450 a month, and the buildings appraise at $4,000,000. Because Portland rents are low relative to values, the refinance is sized at 60% LTV, $2,400,000. The investor brings the difference to closing when the bridge loan is repaid.
Estimated principal and interest on a 30-year loan is about $16,699. Taxes of $2,300 and insurance of $1,200 bring the total payment near $20,199, for DSCR around 1.06x.
| Item | Bridge loan | DSCR refinance |
|---|---|---|
| Basis | Price $3,850,000 | Value $4,000,000 |
| Loan amount | $2,695,000 (70%) | $2,400,000 (60%) |
| Monthly payment | About $23,581 interest-only | About $20,199 with taxes and insurance |
| Units leased | Lease-up | 11 of 11 |
| DSCR | Not used | About 1.06x |
Portland values are high compared with rents, and Oregon caps rent increases on older units. New buildings are exempt from the cap for their first 15 years, but they still have to lease at market. The result is that refinances often land at 60% to 70% LTV.
Plan for that at the start. If the bridge loan is sized close to the full purchase price, the refinance may require more cash than you expect. Running the refinance numbers before you sign the purchase contract, with current rent comps and a realistic tax estimate on the new buildings, avoids surprises later.
Larger balances usually need a full valuation. New middle-housing projects are a fairly young product type, so appraisers may weigh sales of similar new plexes, older plexes and individual townhome sales. High-value homes in the West Hills or Lake Oswego can have limited comps.
Provide certificates of occupancy, builder cost information if available and current rent comps.
Oregon generally does not charge a real estate transfer tax, except in Washington County. Property taxes follow Measure 50, but new construction enters the tax rolls using a ratio applied to market value, which can make taxes on new buildings higher relative to price than on older ones. Ask the county for an estimate on new projects.
Carrying costs during the bridge term include interest, taxes, insurance and utilities on vacant units.
Investors also use bridge loans to buy and renovate high-value homes in the West Hills, Dunthorpe and Lake Oswego. Long-term rents on these homes rarely support a high-leverage refinance, so a sale or a lower-leverage jumbo DSCR loan is the usual exit.
Wildfire risk in some West Hills areas and seismic considerations in older homes affect insurance, so get quotes early. Steep lots, private roads and older retaining walls are also common in the hills and can complicate both renovation scope and valuation. Build those into your budget and timeline.
Large bridge files move fastest when complete. Bring the purchase contract or payoff statement, a property schedule, certificates of occupancy or permits, renovation plans if any, expected rents and your exit plan.
For builder purchases, include any outstanding punch-list items, warranty terms and system development charge status. For maturing construction loans, include the payoff statement, maturity date, any extension terms and the current leasing status of each unit.
If you are a builder refinancing your own finished project, bring the final inspection records and your cost breakdown. Showing what you spent alongside the appraised value helps the reviewer understand the project and how much equity you have in it.
Send the details and the financing team will size the bridge loan and test the refinance at realistic leverage. If the refinance needs more cash than you planned, they can show alternatives, such as selling one building from the package, holding part of the project on a separate loan or using a sub-1.0 DSCR program where it fits.
Our investor loans are business-purpose loans on non-owner-occupied property. Call (877) 298-1001 or use the form below to get a quote.
Residential bridge loans run from $150,000 to $5M+, with larger balances reviewed case by case.
Bridge rates start from 7.99%. Pricing on larger balances depends on the properties, leverage and your experience.
Larger balances usually need a full valuation of each property.
Yes. Paying off a maturing construction loan while units lease is a common Portland use, with a DSCR refinance as the exit.
Portland rents are low relative to values, so lower leverage is often needed for the rent to cover the payment.
Generally no, except in Washington County.
Yes. Residential bridge loans cover 1 to 8 unit investment properties.
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