Bridging Loans
Fast, flexible short-term property finance—complete in 7-14 days
Content reviewed: 13 January 2026
What is a bridging loan and when should you use one?
A bridging loan is short-term secured finance (typically 3-24 months) providing fast property funding when speed is essential. Completing in 7-14 days, bridging loans suit auction purchases, chain breaking, and property refurbishment. Interest rates are 0.5-1.5% monthly, higher than mortgages but justified when speed matters. You must have a clear exit strategy.
Fast bridging finance arranged in days, not weeks.
What is a bridging loan and when should you use one?
A bridging loan is short-term secured finance (typically 3-24 months) that provides fast property funding when speed is essential. Completing in as little as 7-14 days, bridging loans are ideal for auction purchases, chain breaking (buying before selling), and property refurbishment. Interest rates are 0.5-1.5% monthly (6-18% annually), higher than mortgages but justified when speed or flexibility is critical. You must have a clear exit strategy such as selling the property or refinancing to a standard mortgage.
What is a Bridging Loan?
A bridging loan is a short-term secured loan (typically 3-24 months) designed to provide fast property finance when speed is essential or traditional mortgages aren't available. Bridging loans "bridge" timing gaps—buying before selling, purchasing at auction, funding refurbishments, or acquiring unmortgageable properties. They complete in as little as 7-14 days compared to 8-12 weeks for standard mortgages.
Interest rates are higher than standard mortgages—typically 0.5-1.5% per month (equivalent to 6-18% annually)—reflecting the speed, flexibility, and short-term nature of the finance. You can choose to pay interest monthly or "roll it up" (add it to the loan) and pay everything at the end. Most bridging loans allow interest-only payments during the term, with the capital repaid when you "exit" the bridge through your planned exit strategy.
The key to bridging finance is having a clear, credible exit strategy—how you'll repay the loan. Common exits include selling the property you're bridging against, selling another property, remortgaging onto a standard mortgage once refurbishment is complete, or receiving business funding or inheritance. Lenders will assess your exit strategy carefully before approving, and regulated bridges also require affordability assessment if secured on your main home.
Bridging Loans are arranged by introduction only.
Key Benefits of Bridging Loans
Complete in as little as 7-14 days, much faster than traditional mortgages which take 8-12 weeks
Purchase properties that standard lenders won't touch—uninhabitable, commercial, or auction purchases
Buy your next home before selling your current one, avoiding temporary renting or losing your dream property
Borrow against a property's future value after refurbishment, not just its current condition
Expert Tips & Insights
Bridging loans are designed for 3-24 months maximum. They're not long-term financing. You must have a clear, realistic exit strategy—either selling a property, remortgaging to a standard mortgage, or another confirmed funding source. Lenders will want evidence of your exit plan before approving. Monthly interest rates of 0.5-1.5% mean a 12-month loan costs 6-18% annually—expensive if extended beyond the planned term.
Bridging loans charge monthly interest (0.5-1.5%/month = 6-18% APR), arrangement fees (1-2% of loan), valuation fees (£500-2,000), legal fees (£1,000-3,000), and exit fees (sometimes 1%). On a £200k bridge for 6 months at 0.75%/month: £9,000 interest + £3,000 fees = £12,000 total. This is expensive but worthwhile if speed is critical or it's your only option. Always calculate total cost before proceeding.
You MUST have a credible exit strategy. Common exits: sale of property (provide estate agent valuation), remortgage to standard mortgage (confirm you'll meet affordability), sale of another property (provide proof it's marketed), or business sale/funding (provide documentation). Lenders may require evidence like mortgage agreement in principle for the exit mortgage, or proof the property is listed for sale. Weak exit strategies result in declined applications.
Most bridging loans offer 50-75% LTV, though some specialist lenders go to 80%. First charge bridges (where the bridge is the only loan) offer better rates than second charge (where there's an existing mortgage). You can use the property being purchased as security (closed bridge) or another property you own (open bridge). Second charge bridges are more expensive and harder to obtain. Always provide substantial equity/deposit.
Bridges secured on your main residence or buy-to-let you've lived in are FCA-regulated, offering more protection but stricter affordability checks. Unregulated bridges (for investment properties, commercial, or second homes you don't live in) are faster and more flexible but have less consumer protection. Regulated bridges require affordability assessment; unregulated focus primarily on exit strategy and security value. Know which type you need.
Bridging works for: buying at auction (7-28 day completion deadlines), chain breaking (buy next home before selling current), property development (fund purchase + refurb, then remortgage or sell), buying unmortgageable properties to renovate, or urgent business opportunities. Not suitable for: long-term finance (use mortgages), borrowers with weak exit strategies, or those who can't afford the higher costs. Bridging is a specialist tool—use it only when necessary.
Frequently Asked Questions
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Need Fast Property Finance?
Our bridging loan specialists can arrange finance in 7-14 days. Whether you're buying at auction, breaking a chain, or funding refurbishment, we'll find the right solution.