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A bridging loan is short-term finance — typically lasting 1 to 24 months — designed to bridge a funding gap while a longer-term solution is arranged or an asset is sold. Commonly used in property transactions when timing is critical.
Bridging loan rates vary from 0.4% to over 1.5% per month — the wrong lender can add thousands in unnecessary interest costs. Comparing specialist lenders ensures competitive rates, appropriate terms and a workable exit strategy.
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Common questions about bridging loans — rates and eligibility for UK businesses and property investors.
Bridging loans are used for property purchases before a sale completes, auction finance, refurbishment, development funding gaps and business cash flow.
Bridging loans are used for property purchases before a sale completes, auction finance, refurbishment, development funding gaps and business cash flow.
An exit strategy is your plan to repay the loan — such as selling a property or refinancing to a mortgage. Lenders require a clear and credible exit before approving bridging finance.
Rates typically range from 0.4% to 1.5% per month depending on loan-to-value ratio and borrower profile. Monthly rates are quoted rather than APR due to the short-term nature.
Most bridging loans are secured against property with loan-to-value ratios up to 75%. Some lenders consider alternative assets as additional security.