Bridging Finance London

A bridging loan is short-term finance secured against property or land. It is commonly used to bridge a timing or funding gap until the borrower sells the asset, refinances onto longer-term borrowing or completes another defined exit.

The lender assesses the property, borrower, proposed use of funds and exit strategy. If approved, the loan is secured against property and must be repaid by the agreed maturity date through the stated exit.

Common uses include auction purchases, chain breaks, investment acquisitions, refurbishment, commercial property purchases, refinancing, capital raising and completing a purchase before longer-term finance is ready.

There is no guaranteed completion time. Speed depends on valuation, legal work, title, due diligence, borrower information, lender capacity and the complexity of the transaction. A well-prepared case with responsive professionals is more likely to progress efficiently.

The amount depends on property value, loan-to-value, asset type, location, borrower circumstances, works and exit strategy. Minimum and maximum loan sizes vary considerably between lenders.

Loan-to-value, usually shortened to LTV, compares the loan with the value used by the lender. Fees and retained interest may affect the gross loan and the net amount available to the borrower.

The gross loan is the total facility before deductions. The net advance is the amount available after any retained interest, arrangement fees, legal costs or other deductions funded from the facility.

Interest may be retained from the facility, added to the balance, paid monthly or structured in another agreed way. The available methods depend on the lender, loan purpose, affordability and regulatory status.

Potential costs include interest, lender arrangement fees, valuation fees, legal costs, broker fees, administration charges, title insurance and exit or extension fees where applicable. The full cost should be reviewed rather than the monthly rate alone.

Yes. A credible exit is central to bridging finance. Typical exits include sale of the security property, sale of another asset, refinance onto a buy-to-let or commercial mortgage, or replacement with development finance.

Potentially. Bridging finance is often considered where an auction completion deadline is shorter than a conventional mortgage process. The legal pack, valuation, deposit, completion date and exit should be reviewed before bidding.

Yes, subject to lender criteria. Lenders distinguish between light refurbishment, heavier structural works and development. The scope, cost, permissions, experience and post-works exit all influence the appropriate product.

Potentially. A specialist lender may consider property that does not meet mainstream mortgage criteria, but the defect, planned remedy, valuation and exit must be acceptable.

Yes. Investors may use a bridge to acquire or improve a rental property before refinancing onto a suitable buy-to-let mortgage, subject to lender criteria and a credible refinance exit.

Yes. Commercial bridging may support purchases, refinancing, capital raising and time-sensitive transactions involving offices, industrial units, retail, mixed-use assets and other acceptable property.

Yes, many lenders consider limited companies and special-purpose vehicles. They will review ownership, directors, guarantees, source of funds, experience, security and exit.

Potentially. Some lenders accept additional security or a portfolio of properties. Cross-collateralisation can improve leverage but may place multiple assets at risk if the facility is not repaid.

A first-charge bridge takes priority over later charges on the security property. It is commonly used where there is no existing mortgage or where existing secured borrowing will be repaid on completion.

A second-charge bridge sits behind an existing first charge. Consent, available equity and the position of the first-charge lender are important, and pricing or leverage may differ from first-charge funding.

Some bridging loans fall within the FCA regulated mortgage framework, including qualifying circumstances involving a home occupied or intended to be occupied by the borrower or a related person. The facts of the transaction determine the position and it must be classified correctly.

Unregulated bridging commonly relates to investment, commercial and business-purpose property transactions outside the regulated mortgage contract framework. Unregulated does not automatically mean the lender or broker is unauthorised, and other legal or regulatory requirements may still apply.

No. Regulatory status follows the facts, including the borrower, security, occupancy and purpose. It is not simply a product preference.

Potentially. A regulated bridge may allow an eligible borrower to complete a new home purchase before selling an existing property. Affordability, security, saleability and the repayment plan require careful assessment.

Potentially, but refinancing one bridge with another needs a credible reason and improved exit. The new lender will scrutinise why the original facility has not been repaid and whether further time genuinely resolves the issue.

The lender may charge default interest or fees, refuse an extension, appoint receivers or enforce its security. Contacting the lender early is important, but an extension is never guaranteed.

Many do. The valuation type depends on the property, loan and lender. Some cases may use automated, desktop or title-insurance processes, but this is lender-specific and not available for every transaction.

It is strongly advisable to use a solicitor who understands short-term secured lending and can work to the transaction timetable. Some lenders require separate legal representation.

Some lenders consider overseas borrowers or corporate structures, subject to enhanced identity, source-of-funds, tax, legal, sanctions and ownership checks. Availability depends on the full structure and security.

Yes. Call Shadowfax Funding Solutions on 0208 154 6052 for an initial discussion about the property, funding requirement, timetable and proposed exit.

A broker can help identify lenders whose appetite fits the asset, leverage, location, borrower and exit, then present the case coherently and coordinate the application with the lender, valuer and solicitors.