Bridging finance FAQ

A closed bridging loan has a repayment date the lender can treat as contracted, such as a sale that has already exchanged. An open bridging loan has no fixed repayment date, but it still has a maximum term and still needs a credible exit.

Bridging is usually quoted as a monthly rate. A public rates guide reviewed on 22 September 2026 put prime cases at about 0.55%–0.65% a month, mainstream cases at about 0.65%–0.95% and specialist cases at about 1.0%–1.5% or more; the Bridging Trends Q2 2026 average was about 0.81%. Guidance only. Not our rates — we do not lend.

Sometimes. Bridging is secured against property, so underwriters often look first at equity and the exit. Adverse credit can still change the rate, the maximum LTV or whether a refinance exit is realistic.

Not on a retained-interest facility. The interest for the term is added up front and repaid with the loan. Serviced interest is paid each month and needs an income the lender will accept.

Some specialist lenders will consider a facility that clears arrears so a property can be sold in an orderly way. It is still secured borrowing, it is not guaranteed, and you should take advice quickly.

A decision in principle can sometimes be issued the same day. Drawdown typically follows valuation and legal checks; timescales vary. Regulated cases include extra consumer steps and usually take longer.

Many institutional bridging lenders assess risk on the gross loan, including fees and retained interest, and often cap that at around 75% of the security value. Extra cash or additional security may be needed above that.

A regulated bridging term cannot usually run beyond 12 months. If the exit is late, you may need an extension, a refinance or another repayment source. Extensions are not automatic and default can put the property at risk.

It is possible but harder than on an investment file. Lenders still have to treat the loan as a regulated mortgage. Strong equity and a contracted sale can help; recent defaults still matter.

Not automatically. Regulation depends on the security, who occupies it, the borrower and the purpose. Ask the broker which classification applies to your structure.

Many modern bridging facilities rebate unused retained interest if you redeem early, subject to any minimum interest period. Read the illustration you are given. We do not publish a representative example.

Often the file is judged on the asset and the exit. Severe recent insolvency can still block a case. A refinance exit may be harder if mainstream mortgage lenders will not accept the credit profile.

Most unregulated lenders ask directors of an SPV or trading company for a personal guarantee, and they usually require independent legal advice on that guarantee.

Residential investment stock is often discussed up to around 75% gross LTV. Commercial property and land are commonly lower, sometimes around 60% to 65% or less, depending on planning and liquidity.

You should not take an unregulated investment loan if you or family intend to occupy the security. If your plans change, tell the broker immediately so the file can be classified correctly.

Common uses are buying at auction, buying before you sell, rescuing a broken chain, refurbishing a property a mortgage lender will not yet accept, buying land, and releasing capital quickly. See the use-case guides in the advice centre.

The net loan is the cash released to you. The gross loan adds the arrangement fee and any retained or rolled-up interest. Lenders measure LTV on the gross figure. See net vs gross.

Typically an arrangement fee, valuation, your own and the lender's legal fees, and sometimes a broker fee or exit fee. Ask for every fee in writing. See costs and fees.

Usually, yes. Many facilities have a minimum interest period, and retained interest may be partly rebated on early redemption. Check the terms you are offered.

No. A second-charge mortgage is usually longer term and repaid monthly. A bridging loan can be first or second charge but is short term and repaid from an exit. See alternatives to bridging.

Yes. Whether you or a close family member will live in the property usually decides whether the loan is regulated, which changes the checks, protections and maximum term. Answer it accurately.

The Pasecom Group Ltd editorial team. Answers are reviewed on the date shown at the top of the page.

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