Real estate pressure relief bridge loans are typically charged through variable interest rates, origination fees (1-5% of the loan amount), and additional costs such as points or closing expenses. Lenders may also impose prepayment penalties or require collateral. These loans are short-term (6-24 months) and used to fund immediate liquidity gaps, often during property sales or refinancing.

The high costs reflect the elevated risk and short duration of these loans. Lenders assume significant uncertainty due to potential delays in selling the underlying property or market volatility. A 2023 National Association of Realtors report found that 68% of bridge loan applicants faced interest rates exceeding 10%, compared to 6-7% for conventional mortgages, due to risk premiums. Origination fees averaging 3.2% (Federal Housing Finance Agency, 2022) cover administrative expenses and credit assessments. Prepayment penalties, present in 45% of loans (MBA Research, 2023), protect lenders from early repayment losses. These practices align with broader trends: during the 2020-2023 pandemic, bridge loan defaults surged by 22% (U.S. Bank, 2023), justifying stricter pricing models. The combination of high rates and fees ensures lenders mitigate risk while addressing borrowers’ urgent needs for capital.