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Bridging Loans Fast & Easy
UK Property Finance Ltd. is a FCA authorised whole market broker. We have established relationships with the most reputable lenders across the UK. This has given us access to the best deals and rates available. We are specialists in bridging finance. We can guarantee to partner our clients with the right lender to suit their unique requirements. Whatever your goals are, we will find the perfect bridging loan for you.
Speak to day with one of our expert advisors to discuss the best solution for your situation.
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What is a bridging loan?
Bridging finance is a short-term, secure loan that can be arranged quickly. A borrower can be approved in as little as a week! Borrowers have various reasons for applying for a bridging loan. Most commonly, bridging finance is used to bridge the gap between buying a new property and selling their current one – when there is a delay in the chain.
Below are few common types of bridging finance:
- Buy to Sell
- Buying a new house
- Purchase an auction property
- Loans for tax issues
- Renovation and/or refurbishment projects
- Chain delay issues for buyers and movers
- Business bridging finance
- Cash flow problems
- Overseas investment properties
- Buy-to-let properties
- Pensioners looking to raise funds
How much does a bridging loan cost?
To calculate exactly how much a bridging loan will cost, we have created a bridging calculator. Simply input your data into the relevant fields, and the bridging loan calculator will do the rest!
The table below resembles a typical £100,000 bridging loan:
| Interest Rate | Monthly Interest |
|---|---|
| From 0.55% | £550 |
| From 0.70% | £700 |
| From 0.75% | £750 |
| From 0.85% | £850 |
| From 0.95% | £950 |
| From 1.00% | £1,000 |
| From 1.05% | £1,050 |
| From 1.10% | £1,100 |
| From 1.20% | £1,200 |
| From 1.25% | £1,250 |
| From 1.50% | £1,500 |
Typical repayment cost (based on a rate of 0.55%) over 12 months (excluding broker fees):
| Loan Taken | Full Repayment |
|---|---|
| £50,000 | £59,254 |
| £60,000 | £70,148 |
| £70,000 | £81,042 |
| £80,000 | £91,936 |
| £90,000 | £102,829 |
| £100,000 | £113,723 |
| £110,000 | £124,836 |
| £120,000 | £135,948 |
| £130,000 | £147,060 |
| £140,000 | £158,172 |
Criteria for bridging borrowing
Secured short-term finance solutions, bridging loans provide quick access to funds. Requirements generally include collateral and a clear exit strategy. Lenders typically do not require income proof, though they may review it for context. Credit history often has little impact on offers.
Basic Criteria:
- You need to be at least 18 years old and have property in the UK, which is also open to foreigners.
- Properties: Residential, commercial, or land across the UK, including uninhabitable conditions.
- Loan sizes begin at £20,000, with terms ranging from 1 day to 3 years. The maximum loan-to-value (LTV) is 75% without additional security, and can reach 100% with additional collateral.
- We accept flexible borrower profiles, have no age restrictions, and accept adverse credit.
Bridging Loan Example
- Net Loan: £65,000
- Lender Arrangement Fee: £1,302.84
- Broker Fee: £1,999
- Monthly Interest: £505.41 at 0.70%
- Term: 12 months.
- Gross Loan: £76,725.55
Why use UK Property Finance?
UK Property Finance offers independent access to top bridging finance lenders across the UK with fast approvals and FCA-authorized expertise. We provide tailored, affordable options beyond the high street and pride ourselves on quick assessments, often giving same-day decisions.
See our reviews! We are rated Excellent 4.78/5 ★★★★★
Bridging loan pros & cons
Over the last few years, the UK has seen the bridging finance market grow, expand, and diversify like never before. But what exactly is a bridging loan, and what are the benefits of this type of funding option when compared to more traditional financial products?
The table below briefly outlines the main pros and cons of a bridging loan.
| Bridging Pros | Bridging Cons |
| Speed | Higher interest |
| Low cost | Security collateral |
| Simple process | Fees and charges |
| Repayment deferred | Linked to property value |
| All-purpose | |
| Minimal paperwork | |
| Repayment options | |
| Flexible inc. bad credit |
How bridging finance works
It is important to know how bridging finance works before you choose this as your option. We have all the expertise to assist you in securing the right type of financing for your requirements. You should consider the following facts:
- Bridge loans are routinely secured against existing land or property. Proof of income and good credit scores may be required by the lender to be approved.
- Applicants can typically borrow up to a maximum gross loan (net loan + all fees and interest) of 75% or 80% of the value of the property they wish to purchase. This will vary from lender to lender, with most willing to negotiate.
- Bridging finance is generally repaid in full at the end of the term, usually up to one year, including all interest that has been incurred.
What else do I need to know?
The bridging loan will need to be repaid within 12 months at the end of the term. There are no monthly payments made for this type of loan. Interest is only charged for the length of time that the finance is used. There are no early repayment charges if the loan is paid early.
Before approving you for funding, the lender will most likely require an exit strategy. This will outline exactly how you intend to repay the loan.
Bridging loan lenders use a few different calculations when determining whether to approve a loan application and how much to lend. These calculations include:
- Loan-to-value (LTV) ratio: This is the amount of the loan compared to the value of the property used for security.
- Interest rate: The interest rate for a bridging loan is usually higher than a traditional mortgage. This is because it is a higher-risk short-term loan.
- Repayment plan: Lenders will want to know how the borrower plans to repay the loan.
- Affordability: Lenders will want to ensure that the borrower can afford to make the monthly interest payments; typically, the interest is retained, meaning there are no monthly payments.
Proof of income requirements
Income Proof is typically less important for traditional loans, as bridging finance relies on property value and a clear exit strategy. Some lenders may request income documentation to assess interest coverage or for future business.
Borrowing Against Home Equity
You can use the equity in your home, either through a remortgage or a second mortgage, to finance the purchase of another property. Be aware that this can increase your debt and put your home at risk if you are unable to repay it.
Repayment
Bridging loans typically require a lump sum repayment at the end of the term, often within a year. Some lenders may require monthly interest payments; clarify the structure with your lender.
Missed Payments
Failing to repay can lead to high fees, credit damage, repossession, or legal action. If facing difficulty, reach out to your lender promptly to explore options.
Risk
Bridging loans come with high interest rates and short terms. Due to their security against property, a failure to repay could lead to repossession. A strong exit strategy is essential to mitigate these risks.
Credit Impact
Bridging loans appear on your credit report, affecting your score, especially with multiple applications or missed payments.
Getting Started
Contact our advisors, available 7 days a week, to discuss your needs. Check our reviews to see how we’ve assisted others in securing bridging finance.