Gap Loan vs Bridge Loan: Differences & When to Use Each

Gap loans address a specific scenario: you have a committed permanent loan (traditional mortgage or investor financing) but closing is 60-90 days away, and you need to acquire the property immediately. A gap loan bridges the time between your purchase closing and your permanent loan closing. For example, you buy a multifamily property for $5M, but your permanent loan doesn't close for 90 days—a gap loan provides acquisition capital for those three months. LYNK Mortgage gap loans are typically short-duration, interim-specific financing. They work when the end-state is certain—you have a clear permanent loan commitment—and you simply need temporary capital.

LYNK Mortgage bridge loans serve broader purposes than gap loans. A bridge provides acquisition capital when your permanent financing timeline is uncertain or when you're executing a value-add strategy that requires holding the property temporarily. You might bridge an acquisition for 18 months while renovating, then refinance into permanent financing once stabilized. Or you bridge to acquire quickly, then exit through sale when market conditions favor it. LYNK Mortgage bridge loans don't require a committed permanent loan to close; your exit can be refinancing once the property performs, sale when market timing is right, or capital deployment from another source. This flexibility makes bridges applicable to more scenarios than gap loans.

Use a gap loan if you have a committed permanent loan closing soon and simply need acquisition capital for the interim period—it's straightforward interim financing. Use LYNK Mortgage bridge loans if your exit strategy involves value-add execution, uncertain permanent loan timing, strategic sale, or portfolio transitions. If you're unsure whether your permanent loan will close on schedule, bridge financing provides more protection and flexibility. LYNK Mortgage's bridge loans, with rates from 8.75% and no prepayment penalties, work across more scenarios and give you optionality—if permanent financing becomes available early, you can exit without penalty; if your property needs more time for value creation, your bridge term accommodates this.