0116 464 5544Bridging Loan Calculator
Our bridging loan calculator gives a good indication of the expected rates and repayment costs when applying for a bridging loan. Get the best bridging loan rates in the UK, starting from 0.55%. All our bridging finance quotes are fully FCA-regulated (667602).
What is a Bridging Loan Calculator?
Use our bridging loan estimator to calculate potential borrowing expenses based on your individual requirements.
Request a free quote that includes expected interest rates, lender charges, valuation fees, broker fees, and administrative costs.
Please note that the final costs could changes depending on your individual circumstances, our tool gives your a starting point based on common figures.
Our calculator helps you estimate costs for projects like buying a new home, selling your current one, or renovating a property.
How to use our calculator
- Input the property value: Enter the value of the security property.
- Input the loan amount: Enter the amount of money you need to borrow.
- Input the loan term: Enter the length of time you need the loan for (in months).
- Input the interest rate: Enter the interest rate you’ve been quoted, or use our suggested rate
- Click on the ‘Calculate‘ button.
The calculator will then show you the following information:
- The maximum amount you can borrow: This is based on the loan-to-value (LTV) ratio, which is the percentage of the property value that the lender is willing to lend you.
- The monthly interest payment: This is the amount of interest you will be charged each month on the loan.
- The total cost of the loan: This is the total amount of interest and fees you will pay over the life of the loan.
Bridging loan rates starting from 0.55%
See how much a £100,000 bridging loan might cost using the table below. Want to try a different figure? Use our calculator for a quick estimate. For exact costs and advice, book a call with one of our experts. They can explain interest rates and answer your questions.
| Interest Rate | Monthly Interest |
|---|---|
| Rates from 0.55% | £550 |
| Rates from 0.70% | £700 |
| Rates from 0.75% | £750 |
| Rates from 0.85% | £850 |
| Rates from 0.95% | £950 |
| Rates from 1.00% | £1,000 |
| Rates from 1.05% | £1,050 |
| Rates from 1.10% | £1,100 |
| Rates from 1.20% | £1,200 |
| Rates from 1.25% | £1,250 |
| Rates from 1.50% | £1,500 |
Bridging loan eligibility
Each lender will have its own set of bridging financing standards that a borrower must meet to be approved for a loan. The following categories are the most common:
- A private person, partnership, or limited corporation.
- Over the age of 18: Some lenders have an upper age limit.
- Live or have a registered address in the United Kingdom.
- One or more properties which the loan can be secured against. This is known as a “security”.
- Has a clear exit strategy in place, such as selling the property or refinancing.
- Wants to borrow at least £20,000.
- Employed, self-employed, or retired.
Note: While security is necessary, your credit score and income are often not factors in a decision for a bridging loan.
What type of property will be needed for security?
When securing a bridging loan, various types of property can be used as security, including:
- Residential properties for example; houses, flats, bungalows, and houses with multiple occupants.
- Commercial properties such as retail unites, restaurants, takeaways and offices.
- Properties in need of significant repair.
- Projects that are in various stages of completion.
- Land holdings.
This wide range of options means you can use different types of property to secure your loan, depending on what you own and how much you need to borrow. Multiple properties can be used to secure your loan.
A survey based on the reasons why a bridging loan was taken out showed the following:
Other1.48%
| Reason for needing a bridging loan | % Ratio |
|---|---|
| Main residence property | 24.58% |
| Semi-commercial or mixed use | 19.24% |
| Light non structural refurb | 11.47% |
| Commercial property | 7.08% |
| Land with planning | 6.55% |
| Property development | 5.28% |
| Residential investment | 4.15% |
| Heavy refurb or structural work | 4.01% |
| Company Tax or VAT bills | 3.32% |
| Avoid residential foreclosure | 3.17% |
| Avoid investment foreclosure | 2.87% |
| Self Assessment or Capital Gains tax | 2.41% |
| Rebridge facility | 2.24% |
| Land without planning | 2.15% |
When to work with a broker for bridging loans
Deciding between a lender and a broker depends on your loan requirements. Brokers offer wider lender options, expertise in navigating the application process, and potentially better deals, but charge fees. Direct lenders can be cheaper, but they require more legwork and there are a limited lenders that you can go to directly.
Cutting the cost of a bridging loan:
To reduce the cost of your bridging loan, consider using a broker such as UK Property Finance to negotiate better terms with lenders. If you’re buying one property and selling another, using both a security can often lower your borrowing costs. However, remember that any existing mortgage on these properties will impact the overall loan amount you can borrow.
Bridging loan interest calculation:
Bridging lenders have several methods for calculating, charging, and rebating interest. The information that follows applies to the great majority of the resources that we offer:
Interest Rolled up:
- Interest is charged on the balance outstanding.
- Interest payments are not needed, thus the monthly interest charge is added to the account balance each month.
- Compound interest will raise the balance that remains every month.
Paying the loan earlier:
- Bridging loans are often set up with 12-month maturities, with no early redemption fees.
- The minimum loan duration is usually one month ( thirty days ), which means you’ll may interest for the month, even if you repay earlier.
- After the first month, you’ll only pay interest for the days you have the bridging finance. For example, if you repay after 3 months and 10 days, you’ll pay interest for 3 full months and 10 days.
Administrative fee:
If the loan is taken out, the lender will levy an administrative fee of around £295. This is not an application fee; it is payable only if you take out the loan.
Lenders arrangement fees (otherwise known as lender facility fees)
Most lenders charge a 2% setup / administration fee. This fee is usually calculated based on the total or net loan amount. This is usually added to the loan but you have the option to pay upfront.
Valuation fees:
These costs vary depending on the value of the property(s) being used as security. The location and estimated value are also important considerations. Our calculator offers an estimate for the cost of the valuation for mortgage purposes. Desktop valuations are less costly and quicker to do; therefore we use them wherever possible.
Redemption charge:
Some lenders impose a redemption fee when a loan is redeemed. This is the legal expense of removing the charge from the secured property.
Solicitor fees:
The lender hires a solicitor to handle the loan contracts and places a charge on the security property. The costs associated with this are charged to the applicant. Our calculator provides an idea of the amount paid for lenders’ legal expenses.
Securing a Bridging Loan
Taking out bridging finance in the UK involves several steps to secure the loan. A bridging loan is typically used to cover the financial gap between the sale of a current property and the purchase of the next one. Below are the steps and processes to be aware of during the loan procurement process:
- Do your research: Identify a suitable broker that deals with bridging finance. A good place to find a broker with a credible reputation is by using Trustpilot.
- Application: Contact your chosen broker and begin the application process. At UK Property Finance we will ask you how much you need to borrow, the value of the property, purpose of funds and how you intend on paying back the loan. Other information may be also requested as the process continues. Our team are on hand 7 days per week to answer any questions you may have.
- Exit Strategy Confirmation: Bridging loans are short-term, so you’ll need to have a clear exit strategy in place to repay the loan. This could be through the sale of the property, securing a long-term mortgage, or any other planned source of funds. The lender will want to ensure you have a viable plan in place.
- Loan Offer: Once the lender reviews your application and property value, they will issue a formal loan offer. This offer will outline the terms and conditions of the bridging finance, including the interest rate, repayment schedule, fees, and any specific requirements.
- Legal and Due Diligence: Engage with solicitors or legal professionals to review the loan agreement and ensure it aligns with your needs and expectations. Due diligence is conducted to verify your identity, ownership of the property, and any legal issues related to the property prior to the bridging loan completing.
- Acceptance and Documentation: If you are satisfied with the loan offer and the legal aspects, you’ll formally accept the offer. This usually involves signing the loan agreement and providing any necessary documentation requested by the lender
- Funds released: Once all documentation is in order and the lender is satisfied with the due diligence, they will release the funds. The funds can be used to complete property purchases, renovations, or any other planned purpose.
- Exit Strategy Execution: When your exit strategy is ready to be executed, such as the sale of the property or securing a longer-term mortgage, you’ll use the funds from the exit strategy to repay your bridging loan in full.
- Loan Closure: Once your bridging finance is fully repaid, the lender will provide a statement confirming the closure of the loan account. Any legal charges or security arrangements will be released.
The amount you can borrow will be based on the LTV, and the bridging loan interest rates will vary depending on the lender.
Why use UK Property Finance?
The era of rigid, automated loan approvals is a thing of the past. Here’s how we can assist you:
- Conducting comprehensive case reviews to find the best lender and product tailored to your needs.
- Efficiently processing applications.
- Offering expert recommendations to guide your financial decisions.
- Providing specialised advice from industry professionals.
- Granting access to a wide range of lender products, including exclusive options not available elsewhere.
Our approach ensures personalised support and access to diverse financial solutions, surpassing traditional, inflexible lending practices.
About UK Property Finance
Here’s how we excel at delivering exceptional service:
- In-depth understanding of cutting-edge products featuring competitive rates.
- We offer a diverse array of lending alternatives tailored to your unique needs.
- Consistently achieving favourable results.
- Innovative problem-solving capabilities, thinking creatively to find solutions.
- Dedicated, personalised service from a team committed to your success.
Since most bridging loan lenders do not deal directly with the public, you will typically need to go via a loan broker in order to obtain a bridge loan. The majority of high street banks handle bridge loans through distinct companies that are only available through brokers.
| Bank | Compare Rate |
|---|---|
| Bank of Scotland | Bank of Scotland bridging loans |
| Barclays | Barclays bridging loans |
| HSBC | HSBC bridging loans |
| Halifax | Halifax bridging loans |
| Lloyds Bank | Lloyds Bank bridging loans |
| Nationwide | Nationwide bridging loans |
| NatWest | NatWest bridging loans |
| Post Office | Post Office bridging loans |
| RBS | RBS bridging loans |
| Santander | Santander bridging loans |
| Tesco | Tesco bridging loans |
| Yorkshire Bank | Yorkshire Bank bridging loans |
| Go Compare | Go Compare bridging loans |
| confused.com | confused.com bridging loans |
| Moneysupermarket.com | Moneysupermarket.com bridging loans |
| Martin Lewis | Martin Lewis bridging loans |
| UK Bridging Loans | UK Bridging Loans |
We are not affiliated with these banks in anyway, we only provide a comparison service that allows you the choice of a better rate for your loan.
How to get started?
If you think a bridging loan could suit your needs, go ahead and schedule a call with us through the form below. Our friendly advisors are here 7 days a week to advise you.
