🪜
Mezzanine Loans
Fill the gap between senior debt and equity
Mezzanine financing sits between senior debt and equity in the capital stack. It allows borrowers to increase leverage beyond what a first mortgage provides, reducing the equity needed for a deal. Secured by a pledge of the borrower's ownership interest rather than a lien on the property.
Find Mezzanine Lenders →Loan Range
$1000K – $100M
Typical Rate
10% - 18%
Down Payment
Reduces equity to 5-15% total
Term
1-7 years
Closing Time
30-60 days
🎯 Best For
- • Reducing equity requirement
- • Large acquisitions
- • Development projects
- • Recapitalizations
✅ Advantages
- ✓ Reduce equity needed
- ✓ No lien on property (pledge of ownership)
- ✓ Flexible structures
- ✓ Can be interest-only
⚠️ Considerations
- • High interest rates
- • Subordinate position = higher risk
- • Requires senior lender approval
- • Complex documentation
Mezzanine Loan Requirements
- ✓ Strong sponsor track record
- ✓ Viable business plan
- ✓ Senior lender approval for subordinate debt
- ✓ Adequate debt service coverage for total debt
Mezzanine Loans FAQ
How does mezzanine differ from a second mortgage? ▼
A second mortgage is secured by a lien on the property. Mezzanine debt is secured by a pledge of the borrower's ownership interest in the entity that owns the property. This distinction matters for foreclosure — mezzanine lenders can take over the entity via UCC foreclosure, which is faster than mortgage foreclosure.
Find Mezzanine Lenders for Your Deal
Tell us about your property and we'll match you with lenders offering mezzanine loans.
Get Matched — Free →