Bridging Finance: the complete guide from a specialist broker
Short-term property finance for auctions, chain breaks, refurbs and everything between. What it is, what it costs, how fast it really moves, in plain English, from the broker who arranges it daily.
Talk to Ashley about your deal
What is bridging finance?
Bridging finance is short-term money secured against property, normally somewhere between 1 and 12 months. You're using it to cover the gap between two events: you're buying before you've sold, you're completing before a mortgage is ready, or you're funding works before you can refinance.
There are two numbers that matter on every single deal. The first is the LTV, which is how much you can borrow against the value. The second is the exit, which is how the loan gets paid back. Get those two right and the rest of it tends to follow.
Gross and net: the bit that catches people out
When a lender says they do 75% loan to value, what they mean is 75% gross. That's the total facility. It isn't what lands in your account.
The way I explain it to clients is to think about a payslip. If you're on £36,000 a year, that's £3,000 a month gross, but nobody ever sees £3,000 land in their bank. Tax, national insurance, pension and the rest come off first, and the number in the bottom corner is what you actually get. Bridging works the same way. The gross loan is the big advertised number, then the interest, the arrangement fee and the legals come off it, and the net is what you can spend.
So if you need £200,000 in your hand, don't work back from a 75% headline. Ask what the net figure is, because that's the number that decides whether your deal actually works.
"Bridging is a tool, not a product. Half my job is telling people when NOT to use it."
What can it be used for?
- Auction purchases inside the 28-day deadline
- Chain break bridging loans, securing the new home before the old one sells
- Light and heavy refurbishment projects
- Land bridging, with or without planning
- Unmortgageable properties (no kitchen, short lease, structural issues)
- Business cash flow and tax bills, secured on property
Understanding Bridging Loan Rates with Bridging Finance Broker
Bridging rates are monthly, not annual, which is what trips people up when they compare them against a mortgage. Loan to value is the biggest driver of the price, but every deal gets priced on its own facts:
| Loan to value | Typical range (per month) | Notes |
|---|---|---|
| Up to 60% | 0.45% to 0.75% | Cheapest money, strong equity |
| 60–75% | 0.65% to 1.10% | The bridging mainstream |
| 75–80% | 0.95% to 1.25% | Maximum standard leverage |
On top: arrangement fee (typically 2%), valuation, legals. We show every cost in writing before you commit. See the full rates page.
How fast does it move?
You can have a decision in as little as 24 hours, and money can be with you inside a week when a deal is run properly. What actually slows a bridging loan down is almost never the lender. It's the valuation slot, or a solicitor who's on holiday, or a title problem nobody checked for at the start. Tell us your deadline on the first call and we'll work backwards from it.
We're writing this one up: an auction purchase beaten to the 28-day deadline.
See the case studies we have published →Your questions
How much can I borrow with a bridging loan?
Anywhere from £50k up to £5m and beyond. The ceiling is set by the property. Most lenders go to 70 or 75% of its value, sometimes 80%. And people always ask about 100% bridging. It exists, but only if you put up extra security, usually another property with equity in it.
Do I need a big income to qualify?
Not necessarily. Bridging is mostly about the property and how the loan gets repaid, not your payslip. If the exit is strong, plenty of lenders will do the deal with modest income or none at all. That's what non-status lending means.
Are bridging loans regulated by the FCA?
Some are. If the loan is secured on the home you live in, or one you're about to live in, it's regulated with extra consumer protections. Loans on investment property are usually unregulated, which just means business lending, not dodgy. You don't choose, the property decides. We're authorised for both.
What is the difference between an open and closed bridging loan?
A closed bridge has a fixed repayment date, usually because your sale has already exchanged. An open bridge doesn't, you repay when the exit lands, any time within the term. Closed is a bit cheaper because the lender knows how the story ends.
How long can I take to repay a bridging loan?
Terms run from a month up to 12 months, sometimes 18 on unregulated deals. Regulated bridges are capped at 12 by the rules. Most of our clients are in and out within six.
Can I repay a bridging loan early?
Usually yes, and it normally saves you money. Many lenders only charge interest for the months you actually use, and we lean towards the ones with no early repayment penalties.
Does a bridging loan affect my credit score or a future mortgage?
Asking us questions doesn't touch your file. A completed bridge shows on your record like any other borrowing, and repaid on time it does no harm. What mortgage lenders don't love is a bridge that ran over, which is another reason we stress-test the exit before you borrow.
What is an exit strategy?
The way the loan gets repaid, a sale or a refinance. It's the first question every lender asks and the first thing we'll work out with you. Get the exit right and everything else follows.
Got a deal like this on your desk?
Tell us the numbers and we'll tell you honestly what's achievable.
Prefer to put it in writing? Email support@bridgingfinancebroker.co.uk