What is bridging finance?
Bridging finance is short-term, secured lending — typically over property — used to move quickly on a transaction and repaid within months from a defined exit, usually a sale or refinance. It "bridges" the gap between needing money now and having your long-term funding or sale proceeds in place. Because it is fast and flexible, it is the tool of choice when timing is tight: an auction purchase, a broken chain, or a property that needs work before it can be mortgaged. Assesr can package and place bridging-style deals as part of its specialist finance coverage.
How does bridging finance work?
A bridging loan is secured against a property — the one you are buying, one you already own, or both. The lender advances the funds quickly, interest accrues monthly (often rolled up rather than paid each month), and the whole balance is repaid when your exit happens. The term is short, usually 3–18 months. The lender's key concerns are the value of the security and the credibility of the exit: how, exactly, will this loan be repaid?
What is bridging finance used for?
- Auction purchases, where completion is required in around 28 days — see our auction finance guide.
- Chain-breaks, where you need to buy before your existing property sells.
- Light refurbishment, where a property is not currently mortgageable and needs work before refinance.
- Buy-to-let conversions, bridging to purchase and refurbish before moving onto a buy-to-let mortgage.
- Business and commercial situations, such as raising short-term capital against a commercial property ahead of a refinance.
How much does bridging finance cost?
Bridging is priced per month, not per year, because the term is short. As a general guide in the UK market — always confirm current figures with a lender:
- Interest: commonly around 0.6–1.2% per month, depending on the deal and loan-to-value.
- Arrangement fee: typically 1–2% of the loan.
- Valuation and legal fees: paid to third parties, as on any secured deal.
- Exit fee: some lenders charge one, some do not.
Because it is short-term, the headline monthly rate looks high next to an annual mortgage rate — but you only pay it for a few months, and the point is speed and flexibility, not long-term cost.
Regulated vs unregulated bridging
Bridging can be regulated or unregulated. A bridge secured on a property you or a family member lives in is generally regulated; a bridge for a business or investment purpose — the great majority of specialist bridging — is unregulated. This mirrors the wider split in specialist finance, which we cover in is Assesr regulated?.
The exit strategy is everything
Lenders assess the exit as carefully as the loan. There are two common exits:
- Sale. You sell the property and repay the bridge from proceeds. The lender wants confidence the property will sell at the assumed price in the assumed time.
- Refinance. You move onto a longer-term facility — a buy-to-let mortgage, a commercial mortgage, or development exit finance. The lender wants confidence that refinance will actually be available.
A weak or vague exit is the single most common reason a bridge is declined or priced harshly. A strong, evidenced exit is the heart of a good bridging credit paper — see what a credit paper is.
How fast can bridging complete?
Speed is the whole point. A well-packaged bridge with a clear exit can complete in a couple of weeks, sometimes faster. The bottlenecks are valuation, legal work, and — most of all — how completely the deal is presented up front. This is exactly where good packaging pays off: a lender-ready credit paper lets a bridging lender move fast because they are not chasing you for information.
Bridging vs development finance
The two are often confused. Bridging is for acquisition, chain-breaks and light works, secured against existing value. Development finance is for construction — ground-up builds and heavy refurbishment — with staged drawdowns and a monitoring surveyor. If your project involves significant building works, you need development finance; if it is about moving fast on a purchase or a light refurb, you need a bridge.
How to arrange bridging finance
You can go direct to a bridging lender, use a broker, or use an AI broker. Given how much bridging depends on packaging and a credible exit, getting the deal presented well matters enormously. Assesr packages your deal into a lender-ready credit paper in about 60 seconds and matches it to specialist lenders by mandate, for a 0.5% fee on drawdown only, free to submit. For why matched beats mass-emailed, see how mandate-matching works, and weigh direct versus brokered in specialist broker vs going direct.
Frequently asked questions
What is bridging finance?
Bridging finance is short-term, secured lending — typically over property — used to move quickly on a transaction and repaid within months from a defined exit, usually a sale or refinance.
How much does bridging finance cost?
Bridging is priced monthly. Rates commonly sit around 0.6 to 1.2 percent per month, plus an arrangement fee of about 1 to 2 percent, valuation and legal costs. Always confirm current figures with a lender.
How fast can bridging finance complete?
Bridging is built for speed and can complete in a couple of weeks — sometimes faster — when the deal is well packaged and the exit is clear, which is why it is popular for auctions and chain-breaks.
What is an exit strategy in bridging?
The exit is how the bridge gets repaid — usually the sale of the property or a refinance onto a longer-term facility. Lenders assess the exit as carefully as the loan itself.