By Brad MacLiver
Authorship and profile at Google
With the changes in the AZ pharmacy industry independent drug store owners, small or regional pharmacy chains, and pharmacy equity investment groups are acquiringArizona
Bridge Loans are an options for short-term financing that are used while waiting for either permanent financing or the next stage of financing to be obtained. Bridge loans also provide funding to "bridge" the gap between a company’s current needs and their long term requirements for financing. Permanent financing is generally used to take out (or pay back) the bridge loan.
One characteristic of bridge loans is that they can close quickly which, in turn, allows a company to capitalize on a timely business opportunity or acquisition. This quick access to money also allows a business the chance to avoid penalties, bankruptcy, or various other temporary problems. If longer term issues must be dealt with, this “transitional financing” provides the company the necessary time until longer term financing can be secured.
Another property of bridge loans is that the whole process usually requires less documentation than conventional financing. Bridge loan lenders don’t typically have the same government regulations to adhere to, which means they tend to have more flexibility in their lending criteria and the documentation they require. Less documentation, however, does not necessarily mean they won’t perform due diligence to have a comfort level with the transaction before they fund.
Examples of using Bridge Loans in AZ Pharmacy Transactions:
1. An independent pharmacy owner learns of health issues and decides to quickly sell the family ownedArizona
2. A small pharmacy chain needs $1 million to expand their business. They have 3 new equity investors who will be investing in the firm over the next 6 months, but at different intervals. However, the business has opportunities which require action sooner than 6 months. The quick closing bridge loan allows the pharmacy chain access to the needed funds so they can complete their expansion and increase profits. Money from the 3 new equity investors will pay off the bridge loan.
3. A pharmacy owner inArizona
4. A pharmacy group developing new Arizona pharmacy locations can receive bridge loan funding to get through the permitting process of a project when conventional financing isn’t available at this early stage due to there is still too much risk. A bridge loan allows the project to move into the construction phase and then qualify for other forms of financing.
5. When a pharmacy in AZ is owned by two or more partners and one of the partners is ready to exit the business, a bridge loan can help ensure the cash flow and uninterrupted operation of the business during the partner buyout.
6. Real estate, or equipment bought at auction may have a narrow window for closing the deal and timing of traditional financing would keep the buyer from proceeding with the opportunity. Benefits of a bridge loan will permit the pharmacy owner to quickly respond to the opportunity.
When there are business opportunities, buying Arizona pharmacies, selling pharmacies, quick deadlines, an old loan maturing before a new loan can be put in place, funding needs during the permit, planning, or evaluating stages, etc., bridge loans can be an essential financial tool.
Tips regarding AZ pharmacy bridge loans:
1. Bridge loans are quick to obtain, but quick to expire.
2. A bridge loan is similar to a hard money loan and the terms are often used interchangeably in conversations. Both are short-term, higher interest rate, non-standard loans, but in some circles hard money refers to the lending source and a bridge loan refers to the duration of the loan.
3. Because bridge loans usually come with higher interest rates than traditional financing a larger down payment, meaning a lower Loan to Value (LTV) and a lower level of risk and provides an opportunity for lower interest rates.
4. With the shorter time period of bridge loans borrowers will need to be aware that fees for valuations, legal, dues diligence, etc., will be amortized over a shorter period than traditional financing transactions.
Understand the types of deals that require a bridge loan may be considered speculative in nature, or have higher risk factors. Due to this many banks do not offer bridge loans. Banks must meet government regulations and need to justify their lending practices. Riskier bridge loans do not usually fall within the lending parameters of many banks. Therefore a majority of the bridge loans will come from private investment firms. It is best to consult a company that has access to a number of funding sources who provide bridge loans.
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Authorship and profile at Google
With the changes in the AZ pharmacy industry independent drug store owners, small or regional pharmacy chains, and pharmacy equity investment groups are acquiring
Bridge Loans are an options for short-term financing that are used while waiting for either permanent financing or the next stage of financing to be obtained. Bridge loans also provide funding to "bridge" the gap between a company’s current needs and their long term requirements for financing. Permanent financing is generally used to take out (or pay back) the bridge loan.
One characteristic of bridge loans is that they can close quickly which, in turn, allows a company to capitalize on a timely business opportunity or acquisition. This quick access to money also allows a business the chance to avoid penalties, bankruptcy, or various other temporary problems. If longer term issues must be dealt with, this “transitional financing” provides the company the necessary time until longer term financing can be secured.
Another property of bridge loans is that the whole process usually requires less documentation than conventional financing. Bridge loan lenders don’t typically have the same government regulations to adhere to, which means they tend to have more flexibility in their lending criteria and the documentation they require. Less documentation, however, does not necessarily mean they won’t perform due diligence to have a comfort level with the transaction before they fund.
Examples of using Bridge Loans in AZ Pharmacy Transactions:
1. An independent pharmacy owner learns of health issues and decides to quickly sell the family owned
2. A small pharmacy chain needs $1 million to expand their business. They have 3 new equity investors who will be investing in the firm over the next 6 months, but at different intervals. However, the business has opportunities which require action sooner than 6 months. The quick closing bridge loan allows the pharmacy chain access to the needed funds so they can complete their expansion and increase profits. Money from the 3 new equity investors will pay off the bridge loan.
3. A pharmacy owner in
4. A pharmacy group developing new Arizona pharmacy locations can receive bridge loan funding to get through the permitting process of a project when conventional financing isn’t available at this early stage due to there is still too much risk. A bridge loan allows the project to move into the construction phase and then qualify for other forms of financing.
5. When a pharmacy in AZ is owned by two or more partners and one of the partners is ready to exit the business, a bridge loan can help ensure the cash flow and uninterrupted operation of the business during the partner buyout.
6. Real estate, or equipment bought at auction may have a narrow window for closing the deal and timing of traditional financing would keep the buyer from proceeding with the opportunity. Benefits of a bridge loan will permit the pharmacy owner to quickly respond to the opportunity.
When there are business opportunities, buying Arizona pharmacies, selling pharmacies, quick deadlines, an old loan maturing before a new loan can be put in place, funding needs during the permit, planning, or evaluating stages, etc., bridge loans can be an essential financial tool.
Tips regarding AZ pharmacy bridge loans:
1. Bridge loans are quick to obtain, but quick to expire.
2. A bridge loan is similar to a hard money loan and the terms are often used interchangeably in conversations. Both are short-term, higher interest rate, non-standard loans, but in some circles hard money refers to the lending source and a bridge loan refers to the duration of the loan.
3. Because bridge loans usually come with higher interest rates than traditional financing a larger down payment, meaning a lower Loan to Value (LTV) and a lower level of risk and provides an opportunity for lower interest rates.
4. With the shorter time period of bridge loans borrowers will need to be aware that fees for valuations, legal, dues diligence, etc., will be amortized over a shorter period than traditional financing transactions.
Understand the types of deals that require a bridge loan may be considered speculative in nature, or have higher risk factors. Due to this many banks do not offer bridge loans. Banks must meet government regulations and need to justify their lending practices. Riskier bridge loans do not usually fall within the lending parameters of many banks. Therefore a majority of the bridge loans will come from private investment firms. It is best to consult a company that has access to a number of funding sources who provide bridge loans.
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