How bridging loans work
Short answer: a bridging loan is short-term finance, usually for 1 to 24 months, secured on property or land. It covers a timing gap and is repaid in one sum from a planned exit, typically a sale or a refinance onto a longer-term mortgage. Lenders focus on the value of the security and the credibility of that exit. Interest is normally monthly and is often retained or rolled up rather than paid each month. We introduce enquiries; we do not lend.
Last reviewed: 20 October 2026 · By Pasecom Group Ltd editorial team
BridgingLoans.online is an independent UK introducer operated by PASECOM GROUP LTD (company 17139327, ICO ZC117546). We do not lend and we do not advise. Nothing on this page is a quote, an MCOB illustration or an offer of credit.
The problem a bridge is built for
High-street mortgages are designed for slower, long-term lending. They can struggle with a 28-day auction deadline, a chain that has broken, or a property that is not yet habitable. Bridging is meant to be temporary. It is not a cheap substitute for a 25-year mortgage.
What lenders actually underwrite
Specialist bridging underwriters look first at the security and the exit. Personal income still matters on many regulated files and on serviced-interest cases. On investment files the asset and repayment plan often dominate.
Enquiry and decision in principle
You set out value, net funds, term, occupancy and exit. A partner may issue a decision in principle if the shape of the file fits their criteria. That is not an offer.
Valuation and legal work
A valuer, often RICS, inspects or models the security. Solicitors deal with title, charges and the facility documents. Drawdown typically happens only after those checks.
Completion
The lender takes a charge. Net funds go to your solicitor. You then have the term to complete the sale, works or refinance you described.
The exit
You repay from the planned source. If that source slips, interest continues and an extension is not a right.
Gross versus net
The net loan is cash released. The gross loan is what counts against LTV once fees and retained interest are included. Read how bridging loans work for the full walkthrough, and costs and fees for the fee stack.
Is it regulated or unregulated?
Occupancy is the legal dividing line. If you or a close family member live in, or will live in, the property as a home (the usual test is at least 40% of it), the loan is likely to be a regulated mortgage contract, with affordability checks, consumer protections and a term that cannot usually exceed 12 months. If nobody in your family will ever live there, for example a buy-to-let, a commercial unit or land, the loan is usually unregulated. See regulated bridging and unregulated bridging.
A worked outline in pounds
This is an illustration of how the figures fit together, not a quote. Suppose a property is worth £400,000 and you need £250,000 of net funds for nine months. On a retained-interest facility the lender adds its arrangement fee and the interest for the whole term to the net figure to reach the gross loan. That gross loan, not the £250,000 you receive, is what is measured against the £400,000 value. If the gross comes out at around £280,000, the gross LTV is 70%. Valuation, legal and broker fees are usually paid separately on top. Use the calculator to model your own figures with its fixed illustrative assumptions, and read net vs gross for the arithmetic step by step.
First charge, second charge and additional security
A first-charge bridge is the main loan secured on the property. If the property already has a mortgage, the bridge often repays it so it can take first charge. A second-charge bridge sits behind an existing mortgage and normally needs that lender's consent; it is usually available at lower LTVs because the bridging lender is paid only after the first lender on a sale. Some borrowers offer a second property as additional security, which can raise the amount available but puts both properties at risk. See LTV explained.
The three ways interest is handled
Bridging is normally priced monthly. Retained interest is calculated for the term and deducted up front, so there is nothing to pay monthly but the gross loan is larger. Rolled-up interest compounds onto the balance and is repaid at the end. Serviced interest is paid each month from income, which keeps the gross loan lower but needs affordability the lender accepts. Many retained facilities rebate unused interest on early redemption, subject to a minimum term. The comparison is in retained vs serviced vs rolled-up interest.
Open and closed bridges
A closed bridge has a fixed repayment date the lender can rely on, such as a sale that has already exchanged. An open bridge has no fixed date but still has a maximum term and still needs a credible exit. Closed files can be simpler to underwrite; open files depend more on the evidence for the exit. See open vs closed bridging loans.
What can slow a case down
Timescales vary and none can be promised. The common delays are valuation access, title defects, missing leases or searches, unclear source of deposit, second-charge consent and slow replies to the solicitors' questions. Regulated cases include extra consumer steps. Preparing the property details, existing mortgage balances, ID and evidence for the exit before you enquire helps. Read how fast can I get a bridging loan and acceptable exit strategies.
When bridging may be the wrong tool
If there is no urgent timing problem, a remortgage, a further advance from your existing lender or a second-charge mortgage may cost less over the same period. Bridging also suits poorly where the exit depends on hope rather than evidence, such as a refinance that needs income you do not yet have. Compare options in alternatives to bridging finance, and look at the common uses: auction finance, chain breaking and buying before you sell.
Your home or property may be repossessed if you do not keep up repayments on a mortgage or other debt secured on it.
Frequently asked questions
How long does a bridging loan last?
Most bridging facilities run for between 1 and 24 months. Regulated bridging on a home you live in is usually capped at 12 months. The term should be long enough for your exit to happen with some margin, because interest keeps running if the sale or refinance slips.
Do I have to pay interest every month?
Not always. Interest can be retained (deducted from the gross loan up front), rolled up (added to the balance and repaid at the end) or serviced (paid monthly). Retained and rolled-up interest increase the gross loan and so the LTV.
What is an exit strategy?
It is the specific way the loan will be repaid: a sale of the security or another property, a refinance onto a term mortgage, or a documented receipt such as an inheritance or business sale. Lenders test whether the exit is realistic before they lend.
Can a bridging loan be first or second charge?
Both. A first-charge bridge is secured on a property with no existing mortgage, or one it repays. A second charge sits behind an existing mortgage, usually needs that lender's consent and is often available at lower LTVs.
Does BridgingLoans.online lend the money?
No. We are an introducer. We pass suitable enquiries to FCA-regulated brokers or lenders, who make every credit decision and set every term.
Model the facility first
Use the calculator, then enquire if you want an introduction.