What is a bridging loan?
A bridging loan is short-term borrowing secured on property or land, normally repaid in a single sum when that property is sold or refinanced. The British Business Bank describes it as a way to bridge a gap in a business's finances rather than a permanent solution, and the Personal Finance Society notes terms from about a week to 18 months.
Lenders lend a percentage of the property's value — the loan-to-value, or LTV. Because the loan is short, lenders focus on two things: what the property is worth, and how you'll repay. That repayment plan is called the exit.
What do UK property investors use bridging for?
Most bridging for investors falls into a handful of jobs. Each has its own guide:
- Auction purchases — at a traditional auction, Rightmove explains you exchange when the hammer falls, usually pay a 10% deposit, and have 28 days to complete.
- Refurbishment — buying a property a standard mortgage lender won't lend on yet, and funding the works.
- Bridge to let — buy and improve with a bridge, then refinance onto a buy-to-let mortgage.
- Commercial and mixed-use property — offices, industrial units, and shops with flats above.
- Raising money behind an existing mortgage on an investment property, without remortgaging it.
How is interest charged on a bridging loan?
Bridging interest is quoted per month, not per year. The Personal Finance Society lists retained and rolled-up interest as the two main ways lenders charge it, and the British Business Bank notes some lenders take monthly interest-only payments instead.
| Method | How it works | Effect |
|---|---|---|
| Serviced | You pay the interest each month | Smallest loan, but you need monthly cash flow |
| Rolled up | Interest is added to the balance and repaid at the end | No monthly payments; interest compounds |
| Retained | The lender holds back the interest for the term from the advance | No monthly payments; you receive less on day one |
Try all three in the bridging loan calculator.
What does a bridging loan cost?
Expect a monthly interest rate plus fees. Published "from" rates on named lender pages we checked on 2 November 2026 ranged from 0.69% a month (Shawbrook) to 0.94% (Together, commercial); Together says you may be offered a higher rate. The British Business Bank lists broker, lender, legal and administration fees on top. More on this in our bridging loan rates guide.
Bridging usually costs more than a mortgage. It earns its place when speed or the property's condition rules a mortgage out — not as a cheaper alternative.
Why does the exit matter so much?
Every bridging lender underwrites the exit first. The Personal Finance Society calls a viable exit route "a must" and lists refinancing and sale among the common ones, adding that more than one exit is better. If an unregulated loan overruns its term, the PFS notes the rate can rise under the loan agreement — which can eat into, or wipe out, the profit on a deal.
Is a bridging loan regulated?
Only when the borrower or a close family member lives, or will live, in the property — then it's treated like a residential mortgage and regulated by the FCA, per the Personal Finance Society. Bridging on investment, buy-to-let, commercial and business property is generally unregulated. This site handles unregulated cases only. If you'll live in the property, here's where to get regulated advice.
How does this site work?
We're an introducer. You answer four questions below; if your deal fits, you continue to a secure application run by Connexis Group Ltd, a commercial finance desk that places cases with lenders and brokers on its panel. Connexis says its desk reviews each case and usually responds within one working day, and only lenders whose criteria fit see it. Full details are on how it works.