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ARTICLE · 23 SEPTEMBER 2026

Bridge Loans – And What To Keep In Mind

Mayer Brown
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Bridge loans provide critical short-term liquidity during corporate restructuring, but they carry significant legal risks for both lenders and borrowers in crisis situations. This analysis examines the legal framework governing bridge financing in restructuring contexts, including insolvency avoidance rules, unconscionable lending liability, and the ongoing obligation to file for insolvency.

GermanyInsolvency/Bankruptcy/Re-Structuring
Marco Wilhelm
Marco Wilhelm
Malte Richter
Malte Richter
Tina Hoffmann
Tina Hoffmann
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I. Why This Topic Is Important

Bridge loans are short-term financing instruments that provide companies with temporary liquidity—for example, until acquisition financing, refinancing, or a sale is finalized, or during the period required to develop a restructuring plan. In restructuring contexts, bridge loans serve to bridge the gap between the onset of financial difficulties and the implementation of viable restructuring measures, thereby preserving the company’s operational continuity.

Bridge loans should be distinguished from restructuring loans: Whereas restructuring loans are designed to sustainably resolve an existing or impending cause of insolvency and provide funds for a comprehensive restructuring, bridge loans serve exclusively to secure short-term liquidity—typically for a period of one to three months—until a thorough assessment of the company’s viability has been completed and, where appropriate, a restructuring loan can be arranged.

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This Mayer Brown article provides information and comments on legal issues and developments of interest. The foregoing is not a comprehensive treatment of the subject matter covered and is not intended to provide legal advice. Readers should seek specific legal advice before taking any action with respect to the matters discussed herein.

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