Definition of bridge loan
: a short-term loan used to finance an enterprise, investment, or government pending the receipt of other funds
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Recent Examples of bridge loan from the Web
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Italy has pumped 900 million euros ($1.1 billion) into the airline through bridge loans during the past year to keep it afloat.
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Italy has pumped 900 million euros ($1.1 billion) into the airline through bridge loans during the past year to keep it afloat.
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The company was able to secure a $45 million bridge loan from its parent, which is owned by Cerberus, to give it enough cash to make it to the bankruptcy in the first place.
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CVS gathered $49 billion in bridge loans from 20 lenders in December as temporary financing for the acquisition, setting up for Tuesday’s transaction.
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Haywood's financing includes a bridge loan from Milwaukee Economic Development Corp., a nonprofit lender.
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But at the last minute, Pacifica got a $2 million bridge loan to pay off the legal judgment.
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The loan was provided by a company called SC3 capital and according to Manafort's spokesperson the note was meant to be a bridge loan.
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The company plans to sell some HK$1 billion of stock to shareholders at a deep discount to current prices and take on as much as HK$990 million in debt, including a one-year, HK$250 million bridge loan carrying an 18% interest rate.
These example sentences are selected automatically from various online news sources to reflect current usage of the word 'bridge loan.' Views expressed in the examples do not represent the opinion of Merriam-Webster or its editors. Send us feedback.
First Known Use of bridge loan
1973
Financial Definition of BRIDGE LOAN
bridge loan
What It Is
How It Works
To illustrate, suppose a company has been approved for a $1 million loan from a bank. However, this money will not be available for six months, and they are running short on cash. The company could apply for a six-month bridge loan of $50,000 to cover their expenses until the money from the $1 million loan comes through.
Why It Matters
Often, businesses and individuals find themselves in need of fast funding during an interim period while they work out access to larger amounts of funds. The bridge loan essentially "bridges" the gap between when money runs out and when more money will be received.
The cost of bridge loans is often much higher than more traditional financing methods, and they are only meant to be used in special circumstances. If a company must rely on short-term, high-interest financing to continue operations, chances are good that the company is not viable in the long run.
Source: Investing Answers
BRIDGE LOAN Defined for English Language Learners
bridge loan
Definition of bridge loan for English Language Learners
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: money that a bank lends you for a short period of time until you receive the money that you are getting from another source (such as from selling your house)
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