Bridging Loan & Finance Explained

Bridging loans are a popular option for homebuyers who need to meet a deadline, such as buying a property at auction or breaking a chain. They can be arranged in as little as seven working days, depending on the complexity of the loan and the borrower's circumstances. 

Bridging loan applications is generally quicker and more straightforward than securing a mortgage because they are designed to be fast and flexible. Bridging loans are typically repaid in a lump sum within 12 months through the sale of a house or another anticipated means of funds.

Here at Property Link Homes, we're not just familiar with bridging loans; we're deeply versed in their every nuance. With decades of experience, our team understands the complexities of the bridging loan market, ensuring you get tailored, expert guidance at every step.

What is a Bridging Loan Broker?

In the UK's unique property finance landscape, bridging loans are a niche high street banks typically don't touch. That's where a bridging loan broker steps in. We bridge the gap between you and a wealth of private and specialist lenders, offering access to exclusive bridging loan options not commonly found on the open market.

Opting for a broker like us doesn’t just simplify the process; it amplifies your chances of securing a deal that’s right for you. We bring in-depth market knowledge, a keen understanding of which products you qualify for, and, most importantly, established relationships with lenders. 

These connections often tilt the scale in your favour, allowing us to tailor finance options specifically for your needs and present your application in the best possible light. With us, securing a bridging loan becomes less about navigating a complex system and more about unlocking the right opportunities for your financial growth.

What Does a Bridging Loan Broker Do?

As your bridging loan broker, our role extends beyond finding you a loan. We dive into the heart of your financial needs, meticulously assessing market conditions and lender options to pinpoint the most suitable lender for your unique situation.

We're not just facilitators; we're your advisors and negotiators. Our team takes charge of the loan application process, providing you with expert guidance every step of the way. We negotiate terms, ensuring they align perfectly with your financial objectives. Working with us brings a seamless blend of efficiency and compliance, simplifying your path to securing capital.

Our role also involves orchestrating effective communication among all parties involved - lenders, solicitors, or underwriters. This holistic approach eases your journey and positions you advantageously to access the best rates available. With us, securing a bridging loan becomes a streamlined, transparent, and personalised experience.

The Bridging Loan Process and Timeline

The Bridging Loan Process and Timeline – Swift and Straightforward – When it comes to bridging loans, we at Property Link Homes understand the essence of time. Our process is streamlined to ensure quick approvals, often within a mere seven working days. 

We focus on making the journey to securing your loan as smooth and efficient as possible, catering specifically to your urgent needs, whether for an auction purchase, a property chain break, or any other time-sensitive property transaction. 

We aim always to keep things moving swiftly and seamlessly, aligning perfectly with your timeline.

Repayment and Terms of Bridging Loans

Bridging loans are generally repaid in one entire lump sum. This structure is designed for short-term financing, bridging the gap between two financial transactions. While some lenders might offer monthly repayment options, this is less common and needs to be arranged in advance.

The terms of bridging loans are crafted for flexibility, allowing you the option to pay off the loan early. Interest is charged only for the period you hold the loan. However, terms can vary between lenders. Typically, the loan and accumulated interest are repaid at the end of the term.

It's crucial to understand these terms before committing. A conversation with a broker can be invaluable for those with specific requirements or seeking particular terms. At Property Link Homes, we're committed to finding and negotiating the best terms for you, taking into account your unique financial needs.

Bridging Loans with Bad Credit

At Property Link Homes, we understand that a less-than-perfect credit history shouldn't be a barrier to securing financing. Bridging loans are particularly accommodating in this regard. The focus of bridging loan applications is primarily on your exit strategy rather than your credit history.

The short-term nature of these loans means that lenders are more concerned with your plan for repaying the loan, typically within 12 months, rather than your long-term credit history. This approach makes bridging finance a viable option even for those with past credit challenges.

We work with specialist bridging lenders who are often more flexible and understanding of unique financial situations, recognising that past credit issues do not always reflect your current financial standing. 

If you need clarification about your options or how your credit history might affect your loan application, our team is here to help. We'll guide you through the available choices, ensuring you find a solution that aligns with your financial needs and circumstances.

Ease of Accessing Bridging Loans

Accessing bridging loans through Property Link Homes is a smooth and transparent process. We understand the importance of a straightforward path to finance, especially in urgent situations. With the proper guidance and a well-thought-out exit strategy, securing the funding you need becomes a highly achievable goal.

Whether you're exploring bridging loans for the first time or are well-acquainted with this type of financing, our team is here to navigate you through your options. We pride ourselves on offering exceptional customer care, combining our deep industry knowledge with a wide network of lenders to ensure you receive the most competitive rates tailored to your needs.

If you're working against tight deadlines or require a rapid response, our team is adept at providing a fast and professional bridging loan service. Reach out to us, and let's make your journey to securing a bridging loan as efficient and stress-free as possible.

Contact us to discover how our expertly crafted financial solutions can support your property goals.



When applying for bridging finance, lenders generally evaluate the following key aspects:

  • Collateral: Bridging loans are typically secured against a property or other substantial assets. The lender will appraise the asset's value and its potential for sale.
  • Repayment Plan: An essential aspect for lenders is your strategy for loan repayment. Common approaches include selling the existing property, offloading the newly acquired property (often in flipping scenarios), or transitioning to a long-term mortgage.
  • Loan-to-Value (LTV) Ratio: This compares the loan amount to the value of the collateral property, expressed as a percentage. While LTV ratios can differ, most lenders set a ceiling between 60% and 80%.

It's important to note that the specific requirements for bridging finance can differ based on your chosen lender and financial situation.


The time it takes to secure a bridging loan can be as short as seven working days, making it an expedient financing option.

The exact timeline, however, varies based on the specifics of your loan and personal circumstances. Accelerating an urgent application may incur additional costs, but it is doable.

Bridging loans are particularly favoured by those who need quick financing solutions, like purchasing at an auction or managing a property chain break.


Generally, bridging loans are not structured for monthly repayments. Instead, the norm is to repay the loan in one lump sum when the term ends. Given their short-term nature, bridging loans are typically settled within 12 months, though some flexibility may be offered.

In certain scenarios, you might be expected to pay the interest monthly. Under this arrangement, you'd pay off the interest accumulating each month on the loan while the principal sum remains due at the loan’s end.

More commonly, interest on bridging loans is compounded or "rolled up" into the total loan amount, meaning you would repay both the principal and the interest together at the end of the term. This approach can be advantageous for managing cash flow, allowing you to allocate funds towards other immediate expenses like relocation or property renovations.


Typically, the minimum deposit for a bridging loan stands around 25%. This figure, however, is flexible and can vary based on the lender's policies and the individual details of your loan.

Bridging loans are usually secured against property or other high-value assets. The deposit is often calculated as a percentage of the asset's value, known as the loan-to-value (LTV) ratio.

There are scenarios where bridging loans may be available without a deposit, known as 0% deposit loans. These are less common and usually contingent on having additional security to offer.


Primarily, bridging loans are settled by selling a property or refinancing with a traditional mortgage.

You might be required to 'service' the loan during the loan term, which involves making monthly interest payments. Alternatively, you can 'roll up' the interest, accumulating it to be paid at the end of the term along with the principal amount.

Besides these common methods, bridging loans can also be repaid through other means, such as proceeds from selling a business or funds received from an inheritance.

Repayment flexibility is a key feature of bridging loans. The critical aspect is to have a clear and viable plan for repaying the loan by the end of its term, which should be outlined in your loan application.


Indeed, bridging loans are generally more expensive than traditional mortgages.

The interest rates for bridging loans are usually higher and are presented as monthly rates, unlike the annual percentage rate (APR) commonly associated with mortgages.

However, it's important to consider the short-term nature of bridging loans. Interest is charged only for the duration you borrow the funds, and many bridging loans allow early repayment without incurring extra charges.

Bridging loans can be a financially viable solution in various scenarios, particularly when rapid financing is essential for a property purchase. In some cases, they may be the most suitable or only available option for borrowers.


It is possible to convert a bridging loan into a mortgage. This process, known as refinancing, is a common strategy for borrowers who initially use bridging finance for purchasing residential properties.

The feasibility of refinancing into a mortgage largely depends on your financial situation, the lender's criteria, and the specifics of the property you intend to purchase.

Before opting for a bridging loan with the intention of refinancing, evaluating whether this route is a practical and achievable repayment strategy based on your unique circumstances is crucial.


When obtaining a bridging loan from a bank, you'll encounter primarily two types of charges: arrangement fees and interest.

However, additional costs are also part of the process. These may include valuation fees (for assessing the property's value), broker fees (if you're using a broker's services), and administrative fees.

The specific costs can vary significantly between lenders and depend on the purpose of your bridging loan, such as whether it's for residential or commercial use.

The lender charges arrangement fees for setting up the loan, typically ranging from 1.5% to 3% of the total loan amount. 

Unlike traditional loans, the interest on bridging loans is calculated on a monthly basis rather than an annual percentage rate (APR), which borrowers need to be aware of, as it can be a point of confusion.


Mainstream banks in the UK typically do not provide bridging loans, making them unavailable through conventional high street lenders.

The alternative for those needing a bridging loan is to turn to specialist lenders. Often smaller and more focused in their offerings, these lenders specialise in bridging loans but may not be as readily accessible as traditional banks.

To navigate this niche market and connect with the right specialist lender, utilising the services of a bridging broker can be essential. Bridging brokers have the expertise and network to facilitate access to these specialised lending options.


The monthly interest rates on bridging loans vary from 0.45% to 2%. These rates depend on individual case specifics and the prevailing market rates at the time of the loan.

It's important to note that, unlike mortgages, where interest is usually calculated annually, the interest on bridging loans is calculated monthly. This reflects the short-term nature of these loans, often repaid within a year.

The monthly calculation of interest aligns with the short-term usage of bridging loans. Also, many bridging loans are structured to allow repayment without early settlement penalties, further justifying the monthly interest calculation, as it ensures you only pay interest for the duration the loan is held.


Bridging loans are safe and effective financial instruments when used appropriately and with a clear repayment plan. It's always wise to consult with a qualified advisor, such as our specialists at Property Link Homes, to ensure that a bridging loan is the right choice for your circumstances.

Critical considerations for bridging finance include prompt repayment, typically within a year, and these loans are secured against property. This security means that if you cannot repay the loan, the property used as collateral may be at risk.

However, with a robust and reliable exit strategy, bridging finance can be a swift and efficient method for securing property, especially in time-sensitive situations.


Indeed, a bridging loan can be utilised to cover Stamp Duty costs. This can be a practical solution, particularly if you need to access funds for this purpose quickly.

The key is a clear and feasible plan for repaying this additional borrowing to your lender. As with any bridging finance, ensuring a solid repayment strategy is crucial.


While the standard term for a bridging loan is usually up to 12 months, specific lenders may offer extended terms of up to 18 months or even 2 to 3 years, depending on the specifics of your situation.

However, terms extending beyond two years are generally reserved for particularly unique or complex cases.


Utilising bridging finance doesn't officially classify you as a cash buyer, but it empowers you to operate similarly.

The processing time for mortgages can stretch over months, creating an 'onward chain' that requires all parties to wait for the financial transfers to complete. 

Bridging finance, on the other hand, is typically accessible much more rapidly than a mortgage. This speed allows you to circumvent the onward chain, providing a significant advantage in property transactions and making your offer more appealing to sellers.


Obtaining a 100% bridging loan, also known as a 100% Loan-to-Value (LTV) bridging loan, is possible, though such options are not commonplace. 

In these cases, you can borrow the entire value of your property without needing to provide a deposit.

However, the eligibility criteria for 100% LTV bridging loans are typically stringent. You'll likely need to secure the loan with additional assets beyond the property. 

It's also important to note that interest rates and fees for these types of loans tend to be higher, reflecting the increased risk to the lender.


Generally, a 20-40% deposit is required for a bridging loan.

While obtaining a bridging loan without a deposit (a 100% bridging loan) is possible, it necessitates having other assets to secure the loan against. Additionally, such loans are associated with more stringent eligibility criteria and potentially higher costs.


With bridging finance, you can borrow up to £25 million. However, the amount you can borrow is typically limited to approximately 80% of the property's value used as collateral.

It's important to know that different lenders have varying policies and criteria for maximum loan amounts. 

Some lenders may specialise in smaller loans, while others offer maximum limits exceeding £1 million.

When evaluating the affordability of a bridging loan, consider not only the loan amount but also the terms and conditions, including interest rates and fees.


In the UK, a valuation is a standard requirement for most bridging loans. This valuation process is essential because bridging loans are usually secured against property or valuable assets.

Lenders use property valuations to assess the market value and condition of the property being used as collateral. This valuation informs the lender's decision regarding the deposit amount you need to provide. 

The property's value plays a crucial role in determining the terms and conditions of the bridging loan.

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Property Link Homes Ltd is Registered in England & Wales, Company Number 05234968. Registered Office address: 10-10A North Street, Ripon, North Yorkshire, HG4 1JY.

Authorised and regulated by the Financial Conduct Authority. Property Link Homes Ltd is entered on the Financial Services Register under reference 429765.

The guidance and or advice contained within this website is subject to the UK regulatory regime and is therefore primarily targeted to customers in the UK.

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Property Link Homes
10-10A North Street
North Yorkshire
(Above Joplings)
01765 360058
[email protected]
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