Bridging Finance

Fast, flexible funding when timing matters

Bridging finance is a short-term loan designed to “bridge the gap” when you need access to funds quickly. It’s commonly used when a traditional mortgage can’t be arranged in time, or when you need to move fast on a property opportunity.

Whether you’re buying before selling, renovating, investing, or dealing with a tight deadline, bridging finance can provide the speed and flexibility you need — with the right guidance.

What Is Bridging Finance Used For?

Bridging loans are popular with homebuyers, investors, and developers who need rapid access to capital. Common uses include:

✔ Buying a new home before selling your current one

Avoid losing your onward purchase by releasing funds upfront.

✔ Auction purchases

Auction properties typically require completion within 28 days — bridging finance is often the only realistic option.

✔ Refurbishment & light development

Ideal for properties that need work before they qualify for a standard mortgage.

✔ Chain breaks

If your buyer pulls out, bridging can keep your purchase alive.

✔ Buying unmortgageable properties

Examples include:

• No kitchen or bathroom
• Structural issues
• Non-standard construction
• Short leases Bridging lenders are far more flexible in these situations.

✔ Capital raising for business or investment

Release funds quickly for business expansion, tax bills, or investment opportunities.

Why Bridging Finance Costs More

Bridging loans are designed for speed and flexibility — but this comes with higher costs compared to standard mortgages.

Interest Rates

• Typically 0.5% – 1.5% per month
• Rates depend on loan size, loan-to-value (LTV), property type, and exit strategy

Arrangement Fees

• Usually 1% – 2% of the loan amount
• Some lenders charge additional assessment or admin fees
• 
  

Valuation & Legal Fees

• Often higher than standard mortgages due to the speed and complexity of the transaction
• Dual legal representation is common (you and the lender each have solicitors)

Exit Fees

• Some lenders charge an exit fee (often 1%)
• Not all lenders apply this — we’ll guide you through the options

Minimum Terms

• Most bridging loans run for 3–12 months
• Some lenders allow up to 24 months depending on the project

Bridging finance is a powerful tool when used correctly — but it must be structured with a clear exit strategy to avoid unnecessary costs.

What Lenders Look For

Bridging lenders focus less on income and more on the asset and your plan. Key criteria include:

✔ A Clear Exit Strategy

This is the most important factor. Common exits include:

• Sale of the property
• Remortgaging onto a standard mortgage
• Refinancing via development finance
• Sale of another asset

✔ Property Value & Condition

Lenders assess the security carefully. They will lend on:

• Residential property
• Buy-to-let
• Mixed-use
• Commercial
• Land with planning
• Unmortgageable or distressed property (case-by-case)

✔ Loan-to-Value (LTV)

Typical maximum LTV:

• 70–75% on standard bridging
• 60–65% on commercial or heavy refurbishment
• Up to 100% with additional security (cross-charging another property)

✔ Credit History

Bridging lenders are more flexible than mainstream lenders. They may accept:

• Adverse credit
• CCJs
• Defaults
• Missed payments
• Historic bankruptcy (depending on circumstances)

Credit issues matter less than the strength of the security and exit plan.

Who Is Bridging Finance Suitable For?

Bridging loans are ideal for:

• Homebuyers stuck in a chain
• Investors buying at auction
• Developers refurbishing or converting property
• Landlords expanding portfolios
• Clients needing fast capital for business or personal reasons

If speed, flexibility, or property condition is an issue, bridging finance is often the best solution.

If you’re facing a tight deadline or exploring an opportunity that can’t wait, bridging finance could be the right solution. We’ll assess your situation, explain your options clearly, and help you secure fast, flexible funding with a solid exit strategy.