Bridging Loans & Finance

Are you in the middle of a property transaction, but the timelines don’t line up? Does your business need additional funds to cover some rocky changes? Bridging loans offer short-term funds to see you through financial gaps.

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We’re bridging finance experts

Bridging loans come in all shapes and sizes, and sometimes, it takes the help of an expert in the field to help you find the right one.

Bridging Options is run by property finance specialists with extensive experience in the property sector. We connect clients from all backgrounds with the most experienced bridging loan brokers. 

Our team acts quickly to assess your financial situation and goals and provides you with the outcome you’re looking for.

What is a bridging loan?

Bridging loans are smart financial tools that many property investors and individuals use to ‘bridge a gap’ in their finances while they wait for longer-term financing to be arranged. They are commonly used for property transactions.

Let’s say you’re waiting to purchase a new property but your old one is still sitting on the market. Well, a bridging loan would allow you to go ahead with the property purchase, giving you the immediate funds you need, while you wait for your current property to sell.

Bridging loans have plenty of other uses, like funding significant or risky property developments, building a new home, purchasing land, buying a commercial property, or covering inheritance costs.

At Bridging Options, we offer quick and tailored support with bridging loans for residential or commercial property.

How do bridging loans work?

Bridging loans provide much faster access to funds based on the value of your existing assets, usually property, or the value of an asset you intend to purchase. What makes bridging loans most attractive is their short-term use – ranging from as little as a few weeks up to a year. But you can get longer bridge loans in some cases. Most bridging loans are around 6-12 months.

Once secured, you can use the bridging loan to cover costs while you arrange long-term financing, such as a traditional mortgage.

Can anyone get a bridging loan?

Bridging loans are widely accessible. We specialise in helping borrowers find the perfect bridging loans for their short-term financial needs, including:

  • Individuals buying property

  • Property investors looking to secure a good deal

  • Property developers with a large property project on their hands

  • Businesses with cash flow troubles

  • Other financial needs

As with all loans, certain eligibility factors must be considered, such as the value of the assets securing the loan, your credit history, and the viability of the exit strategy for repaying the loan.

Do you have a good credit score? Check your credit report with checkmyfile today – FREE 30-day trial!

How much can I borrow for bridging?

Bridging loans can start from £25,000 up to £25 million.

The exact amount you can borrow with a bridging loan is determined by the value of the assets you use as security and how much equity you have. Most lenders will offer around 75% loan-to-value (LTV).

Use our quick and easy bridging loan calculator and we’ll be in touch to let you know what you can borrow.

How quickly can I get a bridging loan?

When time is of the essence, you need a fast application and quick turnaround. At Bridging Options, we pride ourselves on this.

Getting a bridging loan is usually a relatively fast process compared to traditional loans and mortgages. Many bridging loans can be available within 5 – 15 days, depending on your personal finances and your property plans.

Thanks to our specialist knowledge and quick action, we can ensure your application is ready to go with little to no need for amendments. We’ll make sure you have everything you need to secure your bridging loan fast.

How do I know if a bridging loan is right for me?

Deciding to get a bridging loan will ultimately depend on your need for finance, your current financial situation, and your ability to repay the loan. Bridging loans are great financial solutions for those needing short-term funds, but they do require a strict repayment plan and can be risky if you don’t have one.

Bridging loans are best suited to individuals and businesses who need quick access to finance and already have a clear strategy for repaying the loan.

While the choice of getting a bridge loan is ultimately down to you, it is our job to make sure you have all the tools and information to make this decision easily. That’s why we work with the most skilled brokers and property experts in the market. Our connections have a particular eye for detail and will ensure you make the most informed decisions.

Types of bridging loans we can help you with

Bridging loans come in many forms to provide a range of financial solutions.

closed bridging loan

Closed Bridging Loan

A closed bridging loan is one that has a fixed repayment date. It offers more predictability, but you'll need a clear exit strategy to repay the loan (like a confirmed property sale). This type of loan is a cheaper option and may be ideal if you already have a repayment plan.
open bridging loan

Open Bridging Loan

An open bridging loan doesn't have a fixed repayment date. It can provide you with more flexibility, but you will be expected to repay it within a couple of years in most cases. This type of loan is suitable if you need to make a quick purchase but haven't yet got a plan to repay the finance.
first charge bridging loan

First Charge Bridging Loan

A first-charge bridging loan is given when you own the property outright (meaning you don't have any other loans or mortgages). This means the lender has a primary claim on the property if you cannot repay them. These loans often have better rates due to the reduced risk for lenders.
second charge bridging loans

Second Charge Bridging Loan

A second-charge bridging loan is given when you don't own the property outright (meaning you do have a mortgage or other loan on the property). This means the first lender will have a primary claim if you cannot repay them, and the second bridging lender will have a second claim. They can be more expensive due to the risk involved.

What can bridging loans be used for?

The great thing about bridging loans is that they are extremely versatile and can be used for many situations. At Bridging Options, our connected consultants and advisors have access to an impressive array of bridging loans in the market.

Our team will listen to your needs and source the perfect solution.

Bridging loan features

Bridging loans have various distinctive features, such as the speed at which you can get one, competitive interest rates, and the length of time they last. These features set them apart from other finance options.

Knowing the basic features of a bridging loan will help you decide if you should get one.

How much does a bridging loan cost?

Bridging loans can be expensive, depending on your financial circumstances, the scope of your project, and the condition of the property you wish to secure the loan against. Other factors, like the state of the market, may also affect them.

On top of the costs of the bridging loan itself, you’ll need to factor in things like legal fees, broker fees and interest rates.

While this may sound like a lot to think about, it is so important that you get it right. Choosing the best bridging loan will ensure you have the funds you need to support you in your financial endeavours without breaking the bank. That’s why we are committed to connecting clients to the most experienced bridging loan brokers and helping them get the finance they want.

Want to find out how much you can afford? Get in touch today.

Bridging Loan Key Features
Loan AmountUp to 75% of the property value
Loan Term6-12 months
Type of LoanFirst-charge, second-charge & third-charge
Interest RatesVary depending on the case
Repayment OptionsInterest-only or rolled-up interest
Speed of Approval5-15 days

What are bridging loan interest rates?

Interest rates compensate bridging loan lenders for the money you borrow. Since lenders are open to risk when they loan money on a short-term, flexible basis, the interest rates ensure they recoup the costs.

Bridging loan interest rates are usually higher than traditional mortgages due to the risk they pose. They can vary from 0.4% up to 2% per month.

For example, a 1% monthly interest rate is equivalent to an annual rate of 12%.

Despite their higher interest rates, sometimes the flexibility and short-term nature of a bridge loan are worth it, especially if you want to seize a great opportunity. Our job is to help you find a secured loan with the most attractive deal! A lower interest rate can make all the difference.

What documents do I need for a bridging loan?

At Bridging Options, we prepare you for getting a bridging loan in every aspect, from ensuring our connected brokers find you the best rates and terms to getting your finances and documents ready for application.

Here’s what you’ll need to apply for a bridging loan:

  • Proof of identity (passport or driver’s licence)

  • Proof of address (utility bill, council tax bill or bank statement)

  • Details of the property you’ll use as security

  • Evidence of your planned exit strategy (property sale or mortgage offer)

  • Proof of income and financial statements

  • Credit history report

What is the minimum term for a bridging loan?

The minimum term for a bridging loan is usually around the three-month mark, but borrowers have been known to get shorter terms than this. It all varies depending on the lender and the bridging loan you go for.

Even if you have a longer term, you can still exit the loan sooner by making early repayments, but some lenders charge an early repayment fee. We make sure you get a deal that doesn’t impact your finances with early repayment charges.

How long do you get to pay back a bridging loan?

Bridging finance is designed to be a short-term fix, and most lenders will expect a repayment plan before agreeing to the terms. Bridging loan repayment terms typically range from a few weeks to 12 months or longer, depending on the type of loan you get.

We’ll make sure you’re fully aware of your financial commitments before entering into an agreement.

Do you need a bridging loan? Talk to a bridging finance expert today

Our in-depth knowledge of property finance and extensive database allows us to provide unparalleled guidance and advice. We work with you to find you the right solution quickly and easily.

Mark Piper Bridging Loan Consultant

How do bridging loans differ from other finance options?

Do you need urgent financial support for a property purchase? Bridging loans will often provide a swift solution where other finance options, like a personal loan or mortgage, can’t. Since they usually have faster application times and cover more complex property transactions and projects, bridging loans tend to work well for those in need of quick cash.

What is the difference between a traditional mortgage and a bridging loan?

A bridging loan is a short-term financial solution used to cover gaps between transactions, like buying a new home before selling the old one. It’s usually for up to 12-36 months and carries higher interest rates. In contrast, a mortgage is a long-term loan (often 25-30 years) used specifically to buy property, with lower interest rates but monthly repayments. Look at the quick comparison table below to see the differences between bridging loans and mortgages:

FeatureBridging LoansTraditional Mortgages
PurposeShort-term finance to bridge a financial gapLong-term finance for purchasing property
Term LengthUp to 12 months15 to 40 years
Interest Rates0.4% to 2% per month4% to 8% per year
Lending CriteriaMore lenientStrictly based on income and credit history
Speed of ApprovalFast approvalTakes time for lenders to assess
RiskHigher risk due to high interest ratesLower risk and more stability
Repayment OptionsPaid at the end of the loan termPaid monthly

Considerations before applying for a bridging loan

At Bridging Options, we like to make sure you have every piece of information to make the best decision for your circumstances. Bridging loans have many uses, like bagging a good bargain at the Auction House, covering development costs, preparing for retirement, or simply helping you buy a house before your old one has sold.

Whatever your plans are, you should be prepared for the costs and responsibility of taking out a large loan.

Costs

Before getting a bridging loan, you must think about all of the costs involved. There’s the loan itself, but then there are the extra costs, such as the arrangement fee, valuation fees, legal fees, broker fees, and any early exit charges.

These extra costs don’t always apply to every bridging loan and will likely vary. We’ll be able to help you understand the costs in more detail and find the most affordable options to save you money.

You should also consider any financial penalties for late or missed payments. Paying your loan on time is crucial, but it’s always best to be prepared.

Exit planning

Bridging loans are usually repaid in one lump sum at the end of the term. You’ll be expected to have a plan for this repayment long before it’s due. There are various options for repaying bridging loans, from selling an existing property to securing long-term finance, such as a mortgage.

We’ll help you define a solid repayment strategy so you are well-prepared to exit the loan.

Eligibility

While bridging loans are more lenient than other finance options, it’s still important to know your likelihood of getting one before applying. This prevents you from running the risk of an unnecessary credit search, which could further impact your ability to borrow money.

All lenders have different eligibility criteria. By connecting you to the right broker, you’ll soon find a lender who will accept your application.

Benefits of using a bridging loan

Are you wondering if a bridging loan is for you? Here are some reasons it might be.

Disadvantages of using a bridging loan

Carefully consider every aspect of a bridging loan before getting one – they are a huge commitment!

How do I find a bridging loan lender?

When looking for a bridging loan lender, don’t just go with the first one. Finding the best deal takes a lot of research and comparison. To avoid paying more than you have to, you should search for lenders with competitive rates and terms. You’ll also need to look at each lender’s eligibility criteria to make sure you fit what they’re looking for.

A bridging loan broker is the perfect person to do this. At Bridging Options, we’ll consider your current situation, finances and goals to connect you with the most suitable broker for your needs. We’re connected with bridging finance experts in many specialities, including arranging loans for people with adverse credit, businesses, property investors, and elderly individuals.

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