Bridge Loans

Not surprisingly, it’s a loan that "bridges" the gap between the purchase of a new property and the sale of the borrower's current property. Following is an instance of how a Kennedy bridge loan was handled.

403 acres is a significant parcel of raw land. And that's exactly what Richard DeVincentis and Larry Higgins of Porter Mill Road Properties, LLC were eyeing in Hebron, Wicomico County, Maryland. They envisioned getting it approved for a mixed use community, and selling off pads to developers/builders. It was estimated that the project would have as many as 2,400 residential units, offices and apartments, twin and single-family homes, estate homes, a school, condominiums, age-restricted villas, medical offices, assisted living, senior apartments, and commercial areas.

To complete the transaction, Porter Mill Road Properties needed a loan, and planned to use the raw land as collateral. However, as the purchase date drew nearer, the bank began pulling back, citing restrictions and red tape that purportedly made the deal untenable. So Porter Mill Road was in the uncomfortable position of needing a loan predicated on raw land, and needing it very quickly.

That's where Kennedy Funding came in.

We saw little problem in using raw land as collateral. "We're somewhat unusual, in that we actually thrive on raw land deals," said Jeffrey Wolfer, Kennedy co-CEO. "And savvy business people know to look for alternative money sources like us. Porter Mill Road Properties was a good business transaction for both of us, especially with the borrowers bringing $6 million to the table. We closed the Porter Mill Road Properties deal in just two weeks, and that was with Memorial Day thrown in. A bank loan would've taken weeks or even months."

Also See: Kennedy Funding Bridge Lender