Trends & Analysis

New Markets Emerge Across The Country For Bridge And DSCR Lending

November 25, 2025 Bridge lending showed a rebound in October after several months of declining volume, while DSCR loans set yet another record high on Lightning Docs. As new markets continue to emerge across the country, lenders are finding opportunities for growth in regions that were once off the radar. Bridge Lending Sees Its First Uptick Since July Bridge loan transactions increased 6% month-over-month, marking the first gain since July. While volumes haven’t quite yet returned to the highs of the spring, this rebound signals a pause in the steady decline we’ve seen through the second half of the year.The reasons for the uptick in bridge loan transactions are not perfectly clear. There was an additional business day in October from September, and the year over year increases have remained steady between 10-20% for the past 3 months. Separately, average loan amounts decreased this month, down nearly $30k from September. Average interest rates also decreased on a national level to 10.41%. A slight anomaly this month was that median interest rates rose from 10.13% to 10.25%.The top 10 most active states are shown below, but there hasn’t been much change from previous months. Instead, I’ve included data that highlights areas of growing opportunity. Utah has emerged as a hotspot for bridge lending, with both the state and its largest county, Salt Lake, showing the strongest growth from Q1 to Q3. Minnesota, Oklahoma, Tennessee, and Oregon round out the top five states for growth, demonstrating that lenders have opportunities in every corner of the country. The fastest-growing counties are similarly dispersed, with Clark, WA; Durham, NC; Kings, NY; and Providence, RI each seeing over 100% growth so far this year. DSCR Lending Continues Its Surge I’m tired of writing it, you’re tired of reading it, but the fact is DSCR transactions continue to surge. Lightning Docs users with us since the start of 2024 crossed the 3,000-loan threshold for the first time in October, reaching 3,357 total DSCR loans—an increase of 13% month-over-month, the largest jump since March. Lenders who’ve leaned into this segment continue to see strong resultsDSCR average loan amounts are around the same as last month at just under $315,000. Interest rates continued to decrease. At 7.17% they’re nearing the lowest we’ve seen since October 2024 which also explains why volumes have increased so much over the past few months. There is almost an equal distribution of loans with a 6.0-6.99% interest rate as there are 7.0-7.99% and if this trend continues we may in fact start seeing a significant loan volume under 6% for the first time since 2023 which will result in significant refinance opportunity. Rates Continue to Drop Across the Board In October, the Federal Reserve lowered interest rates for the second consecutive month, and private lending rates followed suit. Both bridge and DSCR averages decreased, mirroring drops in key benchmark indices. Spreads between treasuries and DSCR rates continues to stay consistent showing that market appetite for the product remains robust.As with bridge loans, I’ve shared the top DSCR states below, but the real story is in the growing markets. Five states—Hawaii, Oregon, Alabama, Washington, and Colorado—have seen over 100% growth from Q1 to Q3, highlighting strong momentum in the western U.S. The counties, however, tell a different story. Davidson, TN; Baltimore City, MD; Passaic, NJ; Jefferson, AL; and Orange, FL are the five fastest-growing counties, all located in the Central and Eastern time zones. Opportunities Nationwide Even as overall loan volumes rise and established markets remain dominant, new regions are driving meaningful growth. From Hawaii to Alabama, lenders are expanding into untapped territories and finding new opportunities to scale their businesses. Nema Daghbandan, Esq. Founder and Chief Executive Officer of Lightning Docs Lightning Docs is a proprietary cloud-based software which produces business purpose mortgage loan documents nationally. As a Real Estate Finance Attorney and Partner at Fortra Law, the nation’s largest private lending law firm, Mr. Daghbandan has unique expertise in understanding the needs of private mortgage lenders. Mr. Daghbandan has been recognized by his peers in the legal community as a Super Lawyers® Rising Star from 2016-2022. Only 2.5% of attorneys receive this distinction. He also received a perfect 10/10 rating from attorney review site AVVO®.