Glossary · Real estate finance
Bullet Loans: Financing with Repayment at Maturity
In the case of term financing, only the interest flows during the term – the repayment takes place at the end in a sum, from sale, refinancing or repayment substitute.
Last updated: 18 July 2026 · Reviewed by Jürgen Kronawitter
How does a term financing work?
The rate consists only of the interest share on the constant loan amount; the remaining debt does not decrease during the term. is returned at the end – from a defined event: sales proceeds of a project, one Refinancing in an annuity loan or an accumulated repayment. The interest burden is thus higher over the entire term than in the case of annuity loan – the price of the spared liquidity.
Typical use cases
- project development and Property development finance: During the construction phase, there is no rental income – it is repaid from the sales proceeds.
- Bridge Loans and interim finance: short, terminal structures until the follow-up event.
- Mezzanine tranches and Subordinated loans: Almost always final, often with partial interest deferral (PIK) until exit.
- Tax-motivated investments: Constantly high interest rates remain deductible as advertising costs – the meaningfulness must be checked for tax purposes in individual cases.
Risks and clean structuring
The central risk is repayment: If the sale is delayed or the follow-on finance fails, the full sum is in the fire. lenders therefore require a robust exit proof and calculate buffers for LTV and timetable. Professionally structured means: realistic marketing times, extension options and a plan B for repayment. We check this exit logic for every bullet structure – from project financing to Whole loans.
Frequently asked questions
Term financing – briefly answered
What Is the Difference Between Term Financing and Annuity Loans?
The annuity loan is repaid continuously and the remaining debt decreases continuously; in the case of term financing, the remaining debt remains constant and is repaid in one sum at the end.
Why are bullet loan more expensive?
Because the full loan amount is interest over the entire term and the repayment risk is concentrated at the end. lenders price this risk with higher margins.
When is a term financing useful?
Whenever there is no cash flow available for repayment during the term or liquidity should consciously work in the project – typical in project developments, bridge situations and mezzanine tranches.
Further reading
Related terms and services
Next step
Request an initial finance assessment
Turn the terminology into a workable financing structure. Send us your key project details; we usually respond within 1–2 working days with a realistic initial assessment.
About the author
Jürgen Kronawitter
Jürgen Kronawitter specialises in structured real estate finance. He helps property investors, developers and portfolio owners implement complex financing solutions. His work focuses on structuring and arranging senior loans, whole loans, mezzanine capital and bridge loans, as well as tailored financing for acquisitions, investment properties, developments and refinancing.