How bridging loans work
A bridging loan is short-term finance secured on property or land, used to cover a timing gap until a sale, refinance or other exit repays it. This page is the plain overview. The longer ranking guide keeps the original URL.
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.
Regulated or unregulated
Occupation is the usual dividing line. If you or a close family member occupy, or will occupy, at least 40% of the security, the loan is typically a regulated mortgage contract. See regulated bridging and unregulated bridging.
Model the facility first
Use the calculator, then enquire if you want an introduction.