Are hard money and bridge loans the same thing?

In investor practice the terms overlap — both are short-term, collateral-first debt. Hard money often means acquisition + rehab on a flip; bridge often means gap financing between two transactions (buy before sell closes). Jaken Finance Group prices both at 8.99%–13.5% IO on qualified non-owner-occupied files.

Can I use a bridge loan to fund a fix-and-flip?

Yes when the file includes purchase, scope, sold comps, and a resale exit within the bridge term. Rehab holdbacks release on inspection milestones — same draw mechanics as dedicated fix-and-flip programs.

What exit works after a flip bridge loan?

Sale payoff from ARV minus ~8% costs is the primary flip exit. BRRRR operators may bridge to DSCR permanent at 5.75%–10.5% when DSCR ≥1.0 and seasoning requirements are met.

Blog

Hard Money and Bridge Loans to Fund and Flip Property

Published June 12, 2026 · Updated July 18, 2026

By Jason Taken · Principal, Jaken Finance Group

Hard money vs bridge for flips — when 8.99%–13.5% IO acquisition-rehab fits vs gap financing between sale and purchase on non-owner-occupied deals.

Investors searching for hard money and bridge loans often find overlapping definitions — both describe short-term, collateral-first debt on non-owner-occupied real estate. In practice, hard money usually means acquisition + rehab funding for a value-add flip; bridge often means gap financing between two transactions — buying the next asset before the current one sells. Jaken Finance Group underwrites qualified investment-property bridge files at 8.99%–13.5% interest-only. This guide separates the use cases, shows when each structure funds a flip, and maps exit math before LOI.

Hard money vs bridge — how investors use the terms

Term	Typical investor meaning	Collateral focus	Common exit
Hard money	Flip / value-add acquisition + rehab	Subject property ARV + LTC	Resale or DSCR refi
Bridge loan	Timing gap between buy and sell	One or two properties	Sale of departing asset
Fix-and-flip bridge	Combined purchase + holdback	Subject SFR / small MF	Resale within 6–12 mo

What is hard money · Bridge loans for investors · Fix and flip requirements.

Many lenders — including Jaken Finance Group — use bridge as the product name and hard money as the colloquial label. Underwriting is the same: sold comps, scope, entity, exit. Rate band is 8.99%–13.5% IO regardless of which term appears on the term sheet.

When hard money funds the flip

The classic flip path: acquire distressed non-owner-occupied SFR or small multifamily, rehab, sell within 4–9 months. Hard money (bridge) covers:

Purchase — often up to ~90% LTC capped at ~70%–75% ARV
Rehab holdback — released on inspection milestones
Carry — IO at 8.99%–13.5% until sale

Banks rarely fund heavy rehab on distressed collateral because as-is value does not support leverage and condition requirements block close. Hard money sizes on ARV from sold comps and scope with 10%–15% contingency.

Using hard money to invest · Fix and flip calculator.

When a bridge loan fills a timing gap

Bridge structures shine when liquidity is trapped in an asset you are selling:

Scenario: You own Property A under contract to sell in 45 days. Property B — an off-market flip — requires close in 14 days. A bridge loan on Property B (or cross-collateral on A + B where permitted) funds the acquisition while A’s sale generates payoff cash.

Factor	Flip hard money	Transactional bridge
Primary need	Rehab + resale spread	Close timing
Holdback	Yes — draw schedule	Sometimes minimal rehab
Cross-collateral	Subject only typical	May include departing asset
Exit	ARV sale	Sale of Property A

Understand release terms if two properties secure one note — payoff on the departing asset should trigger partial release on the remaining collateral.

Combined structure — bridge that behaves like a flip loan

Most Jaken Finance Group flip files are bridge notes in legal documentation: 6–18 month term, IO, collateral on the subject investment property. The “bridge” spans from acquisition to resale (or DSCR refi at 5.75%–10.5%).

Product features that matter on the term sheet:

Feature	Why it matters
LTC / ARV caps	Determines cash to close
Draw schedule	Matches GC payment rhythm
Extension options	Fee + max months if sale slips
Prepayment	Flip exits early — confirm no penalty
Entity vesting	LLC required on most files

Checklist for evaluating hard money proposals · Hard money application process.

Worked example — acquisition-rehab bridge

Assumptions: $175,000 purchase + $40,000 rehab = $215,000 all-in. ARV $280,000. 90% LTC → $193,500 note at 10.25% IO ≈ $1,653/mo during 5-month hold ≈ $8,265 carry.

Line	Amount
ARV	$280,000
Sale costs (~8%)	−$22,400
Net sale	$257,600
All-in basis	−$215,000
Carry + closing (approx.)	−$11,500
Spread (pre-tax)	~$31,100

Cash to close ≈ $21,500 (all-in minus note) plus origination and third-party costs. Preserving two months IO reserve (~$3,300) avoids draw delays when inspections slip a week.

Stress ARV −10% and +1 month carry — at $252K ARV, net after 8% costs ≈ $231,840, spread falls to roughly $5,340 before tax. That margin still works; at −15% ARV the deal turns marginal fast.

Worked example — buy-before-sell bridge

Assumptions: Property A under contract at $320,000 sale, closing in 60 days. Property B purchase $210,000 — light cosmetic rehab $15,000, ARV $265,000. Bridge on B: 85% of $225K all-in = $191,250 at 11.5% IO ≈ $1,833/mo.

Month	Event	Bridge balance
0	Close Property B	$191,250
2	Complete rehab	$191,250
2.5	List B	IO accruing
3	Close Property A	Paydown from A proceeds
5	Sell Property B	Payoff bridge + profit

Total IO ≈ 5 months × $1,833 = $9,165 across both carry windows. Model Property A sale delay (+30 days) before you cross-collateral — each idle month burns spread.

Hard money / bridge vs bank — flip funding comparison

Factor	Hard money / bridge	Bank investment
Rate	8.99%–13.5% IO	Lower, amortizing
Close	7–14 business days	30–45+ days
Rehab draws	Milestone releases	Uncommon on distressed
Sizing	ARV + LTC	As-is + DTI
Property	Non-owner-occupied only	Varies

DSCR vs hard money vs conventional · DSCR hub.

Exit paths — sale, refi, or portfolio sale

Every bridge file needs a written exit at submission:

Exit	Best for	Permanent product
Resale	Classic flip	N/A — payoff from proceeds
DSCR refi	BRRRR / hold	5.75%–10.5% at DSCR ≥1.0
Sale of other asset	Timing bridge	Paydown from liquidity event

Hard money buy-and-hold strategy · Scale rental portfolio with DSCR.

Confirm seasoning (6–12 months from note date on many DSCR programs) before you rely on refi exit. Bridge without sale or refi path becomes indefinite high-IO carry.

File package — before term sheet

Document	Purpose
Purchase contract(s)	Timeline and price
Sold comps (3+)	ARV / value support
Scope + bids	LTC and draw schedule
Entity docs	LLC OA, EIN, good standing
Exit letter / pro forma	Sale or DSCR path
Insurance quote	Investor/landlord coverage
Departing asset contract (if bridge)	Paydown source

For buy-before-sell bridges, include Property A sale contract and net proceeds estimate so underwriting sees payoff capacity beyond the flip ARV alone.

Draw mechanics on rehab bridges

Rehab holdbacks release on documented milestones — not verbal GC updates:

Milestone	Typical tranche
Closing	Purchase + initial holdback deposit
Rough-in / mechanical	Per approved scope line items
Drywall / finishes	Subsequent inspections
CO / final	Remaining holdback

Plan 3–5 business days per draw. See fix and flip draw process. Submit requests 48 hours before milestone completion to keep GCs paid on schedule.

Risks to model honestly

IO carry — 8.99%–13.5% accrues monthly; delays on either leg of a buy-before-sell bridge compound cost
ARV miss — size exit on conservative sold comps, not active list prices
Scope overrun — 10%–15% contingency is mandatory in underwritten files
Cross-collateral trap — one delayed sale can block release on the other asset
Extension cost — pre-negotiate max term and fee at origination

Hard money loan mistakes to avoid · Hard money loan statistics 2026.

When bridge / hard money is the wrong tool

Stabilized leased asset — use DSCR at 5.75%–10.5%, not bridge
Owner-occupied purchase — Jaken Finance Group finances non-owner-occupied investment property only
No exit documented — bridge without payoff source is high-IO indefinite carry
Thin spread after 8% sale costs — pass or renegotiate purchase basis