If you need short term finance to fund the purchase of a new property, a bridging loan could help. Compare lenders that offer the lowest interest rates for the loan amount and term you need.
Looking through a range of options gives you more chance of securing a great deal. You'll only find results from genuine companies. Our data experts check each company before we add them to our comparisons.
1
Work out how much you need
Calculate how much you need to borrow and how long you'd need to repay it based on how much you can afford to pay every month.
2
Compare your options
Compare bridging loan deals from different providers and check any conditions of the loan. Then pick a deal that offers the cheapest bridging loans with the lowest interest.
3
Apply for the loan
Fill out a bridging loan application and provide your contact and financial details. The lender will then asses your affordability for the loan.
Think carefully before securing other debts against your home. You home may be repossessed if you do not keep up repayments on your mortgage or any other debt secured on it.
| Available On Properties In England | |
| Available On Properties In Wales | |
| Minimum Loan | £75,000 |
| Maximum Loan | £2,500,000 |
| Minimum Property Value | £100,000 |
| UK Residents |
| Available On Properties In England | |
| Available On Properties In Scotland | |
| Available On Properties In Wales | |
| Minimum Loan | £50,000 |
| Maximum Loan | £25,000,000 |
| Minimum Property Value | £200,000 |
| UK Residents |
| Available On Properties In England | |
| Available On Properties In Scotland | |
| Available On Properties In Wales | |
| Minimum Loan | £125,000 |
| Maximum Loan | £25,000,000 |
| Minimum Property Value | £150,000 |
| UK Residents |
| Available On Properties In England | |
| Available On Properties In Scotland | |
| Available On Properties In Wales | |
| Minimum Loan | £50,000 |
| Maximum Loan | £1,000,000 |
| Minimum Property Value | £100,000 |
| UK Residents |
| Available On Properties In England | |
| Available On Properties In Scotland | |
| Available On Properties In Wales | |
| Minimum Loan | £75,000 |
| Maximum Loan | £15,000,000 |
| Minimum Property Value | £100,000 |
| UK Residents |
| Available On Properties In England | |
| Available On Properties In Wales | |
| Minimum Loan | £50,000 |
| Maximum Loan | £1,500,000 |
| Minimum Property Value | £150,000 |
| UK Residents |
| Available On Properties In England | |
| Available On Properties In Scotland | |
| Available On Properties In Wales | |
| Minimum Loan | £50,000 |
| Maximum Loan | £5,000,000 |
| Minimum Property Value | £50,000 |
| UK Residents |
| Available On Properties In England | |
| Available On Properties In Wales | |
| Minimum Loan | £50,000 |
| Maximum Loan | £5,000,000 |
| Minimum Property Value | £200,000 |
| UK Residents |
| Available On Properties In England | |
| Available On Properties In Wales | |
| Minimum Loan | £100,000 |
| Maximum Loan | £4,000,000 |
| UK Residents |
| Available On Properties In England | |
| Available On Properties In Scotland | |
| Available On Properties In Wales | |
| Minimum Loan | £75,000 |
| Maximum Loan | £3,000,000 |
| Minimum Property Value | £50,000 |
| UK Residents |
We are classed as a credit broker for consumer credit, not a lender.
Our services are provided at no cost to you. We may receive a commission from the companies we refer you to, but this does not affect what you will pay for the product you choose.
| Based on borrowing | £158,000 over 1 year | The overall cost of comparison | 11.6% APRC representative |
|---|---|---|---|
| Interest rate | 8.30% fixed for 1 year (12 instalments of £1,127.75 pm) | Broker fee | £995 |
| Lender fee | £3185 | Total amount payable | £171,533.00 inc. interest of £13,533.00 |
Bridging or bridge loans 'bridge' the gap when you need to pay for something, but you're waiting for funds to become available.
They're often used by people who are taking out a mortgage to buy a property, but are waiting for the sale of another property to go through. A mortgage bridge loan allows them to borrow the money required for a short time.
Like mortgages, bridge loans are secured loans. This means you have to have a high-value asset to get one, such as a property or land.
Find out more in our guide to bridge loans.
There are two types of bridge loans:
These have no set end date. This means they can be repaid whenever your funds become available. They usually last for up to a year, and sometimes even longer.
These have a fixed end date. This date is usually based on when you know you'll have funds available to pay back what you know. They're usually short-term bridging loans, lasting just a few weeks or months.
If you want more security you can compare regulated bridge loans here.
A mortgage bridging loan is an example of a closed bridging loan, as it could be used if you have exchanged contracts on a property but are waiting for your property sale to complete.
Open bridging loans are usually more expensive than closed bridging loans because they're more flexible. Whichever kind you choose, you need an 'exit route' a way to repay your bridging finance.
Bridge loan financing could be used for lots of reasons. These include:
Buying a property
Property development
Buy-to-let investment
Business ventures
Paying a tax bill
Divorce settlements.
Bridging loans are often used by those who are taking out a mortgage to buy a house, but are waiting for the sale of their previous home to go through. You can compare bridging loans for house purchase here.
Bridge loans are also used by property developers at auction. This is because they often need to pay a deposit to secure their purchase at short notice.
If you have a business and need financing to move to a new office location, you can compare business bridging loans.
Bridging loans are also becoming popular with people who are moving house.
If you're considering a bridge loan, it's best to compare bridging loans from several providers to find a deal that suits you. When comparing bridge loans, here are a few things you may want to think about:
How much you want to borrow: Lenders offer bridge loan financing from £5,000 up to £25 million.
How much your property's worth: This affects how much you can borrow and the bridge loan rates you'll get.
How long you need to borrow for: Bridging loans can be as short as one month, or as long as two years.
Whether you have a mortgage on your property: This affects how much you can borrow through a bridge loan. It also affects whether you can look at first charge or second charge loans.
When you apply for bridging finance, the lender adds a 'charge' to the property you're using as security. These charges set the priority of debts if you can't repay your loan. If a property was seized and sold to pay off outstanding loans, a first charge loan would have to be paid first before a second charge loan could be paid back.
When you apply for bridging finance, the lender adds a 'charge' to the property you're using as security. These charges set the priority of debts if you can't repay your loan. If a property was seized and sold to pay off outstanding loans, a first charge loan would have to be paid first before a second charge loan could be paid back.
First charge loans are where the bridge loan is the first or only borrowing secured against your property. Mortgages are normally first charge loans. But if you have no mortgage or outstanding borrowing on your property, a different kind of loan - like a bridge loan - can be your first charge loan.
Second charge loans are where there's already a loan or a mortgage against the property. Second charge lenders usually need the permission of the first charge lender before they can be added.
There's no limit on how many charges can be listed on a property.
It depends on your credit rating, the value of the property you're using for security and the value of the property against the bridge loan. But the maximum a bank will lend in bridging finance can vary greatly, ranging from £50,000 to £25 million and beyond.
Bridging loans can be an expensive way to borrow money. That's because bridge loan rates tend to be pretty high and are often calculated on a monthly basis, rather than an annual basis. They could range from around 0.4% to 2%.
Unlike a mortgage, bridge loans don't last very long. They're essentially meant to 'tide you over' for a few weeks or months. As they are short term, bridging loans usually charge monthly interest rates rather than an annual percentage rate (APR). This means that just a small difference in the interest rate can have a big impact on the overall cost of your bridge loan.
But the interest is not always charged monthly. There are three main ways it can be charged. These are:
Monthly: You pay the interest monthly and it's not added to your bridging finance.
Deferred or rolled up: You pay all the interest at the end of your bridge loan. There are no monthly interest payments.
Retained: You borrow the interest for an agreed period, and pay it all back at the end of the bridge loan.
Some lenders let you combine these options. For example, you could choose retained interest for the first six months, and then switch to monthly interest.
Don't forget there are lots of other fees and charges that you'll have to pay on top of the interest too. You'll need to check the costs carefully before you go ahead.
Bridging loans can be an expensive way to borrow money, and are thus meant for very specific circumstances. Make sure you have a solid exit strategy. Take a close look at your finances, and be realistic about how long you will need it for and how much it will cost.”Salman Haqqi, Loans expert
Interest isn't the only cost on bridging finance. Bridge loan costs can include several types of fees. These are:
Arrangement or facility fee: What you pay for setting up the bridge loan. It's usually around 1 to 2% of the loan.
Exit fees: This is usually around 1% of the bridge loan if you pay it back early. Not all lenders charge an exit fee.
Administration or repayment fees: This is what you pay for the paperwork to be completed at the end of your bridging finance.
Legal fees: This pays the lender's legal fees. It's usually charged at a set rate.
Valuation fees: This pays for the surveyor to value your property.
Broker fees: If you use a broker, this pays for their work in looking at bridging loans for you and choosing the best bridge loans for you.
There might be other fees too, so bear this in mind before you decide if bridging finance is right for you.
APR (Annual Percentage Rate) is a type of interest rate offered by lenders and banks. It includes the interest rate of the product, but also takes into account any fees. Therefore it is generally best to look out for the advertised APR when comparing, so that you know exactly what you will be earning or paying.
APR must include all mandatory fees, however it does not include voluntary ones, even if they require an opt-out.
Here's a step-by-step guide on finding the best bridge loans and best bridging finance rates, and doing your application.
Decide how much do you need to borrow and for how long?
Calculate how much your property is worth and how much equity you have?
Use the comparison table above to compare bridge loans?
Decide whether you want to speak to a broker or apply online.
Pick the bridge loan deal you like and apply. Make sure to read the small print to find out about all the costs and fees.
You'll usually find out if your application's been approved within 24 hours. Once your application's approved, the money could be in your account within two weeks.
Many lenders will still consider your application for bridging finance even if you have bad credit. But, as you're seen as a more risky customer, your loan might have a higher interest rate. This will make it more expensive. You're unlikely to be able to get the very best bridge loan rates if you have bad credit.
There are lots of different places you could get a bridge loan from. These range from major high street banks to small, specialist lenders. You'll see a list of the best bridge loans and compare bridging loans from different companies in the comparison table at the top of this page.
A broker could help you find the right bridging finance. They may charge a fee, but they'll probably be able to find you the very best bridging loan rates.
As with most things, bridging loans have their advantages and disadvantages:
Application process is fast
You can borrow large amounts and that the borrowing is flexible.
You'll get the money pretty quickly.
Interest rates and fees are high
The loan is secured against your property.
You risk losing your home if you can't pay your bridge loan back.
Bridge loans are quite specialist in that you borrow money for a very short time. There are some alternatives to bridging finance, though. These include:
Second mortgage: You could look into getting a second mortgage.
Remortgage: You could remortgage your current home to free up some money.
Secured loan: Here's how secured loans work.
Personal loan: You could check if a personal loan could work for your needs.
Let to buy: If you want to buy a property and the sale of your first property falls through, a let to buy mortgage could be worth considering.
Exactly what is a loan? What can you use it for and how do you get one? Find answers to all your questions about loans here.
Read MoreYou can get a personal loan with bad credit, but the rates will likely be high. It can be harder to get a loan with bad credit, and it may be worth trying to improve your score before you apply for a loan.
Read MoreYour credit record has a big impact on the type of loan you can get and how much it will cost. Here is how your credit history affects your loan application and what you can do about it.
Read MoreShould you borrow against your house? Find out if taking out a secured loan against your home is sensible or something to avoid.
Read MoreChoosing the right way to borrow money can make it cheaper and easier to manage. Here is when you should use a credit card, loan or overdraft.
Read MoreWhen you miss a payment on your loan, you'll be charged a fee. You may be issued with a County Court Judgement or have to declare yourself bankrupt if you continue to miss payments.
Read MoreComparing loans could help you save money. Our award-winning loan comparison service makes sure you get our best interest rates. Our aim is to provide you with the most up-to-date information, as well as useful tools and calculators so to help you make life's most important decisions and take control of your money.
We have always aimed to provide the best possible services to bridge the gap between our users and our clients. Over the years, we have been thrilled to be recognised by various prestigious bodies and organisations for those efforts.
Last updated: 14 February, 2022
