🔧 Bridging Finance : Your Fast-Track to Securing the Right Property
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1. What is Bridging Finance ?
Bridging finance (or a bridging loan) is a short‑term -secured loan, usually spanning 1-24 months- designed to “bridge” a financial gap until you can finalise long‑term funding like a mortgage or property sale.
- Terms are typically interest‑only, secured against property (first or second charge) and arranged quickly
- Ideal for auction purchases, chain breaks, renovations or temporary funding needs
2. When Is Bridging Finance Useful ?
Bridging finance makes sense when you :
- Need to act fast – e.g., auctions or competitive purchases
- Are awaiting the sale of a property (chain break)
- Want to refurbish an unmortgageable property before refinancing
But beware, it’s expensive and risky if your exit plan fails.
“Bridging is extremely risky and should be avoided at all costs. If you don’t have a realistic exit strategy… you could be stuck with an expensive loan for a long time.”
Melanie Bien, a mortgage broker in The Guardian
3. How Much Can I Borrow ?
Bridging loans are usually limited to about 70–75% LTV based on security value, not income.
Loan sizes range from £25,000 up to £10 million, depending on lender and purpose.
4. What Does It Cost ?
- Interest : Typically 0.4%–2% per month (roughly 8.5%–13% APR)
- Arrangement fees : 1–2% (or higher) of the loan sum.
- Exit fees, valuation, legal costs : Vary
A typical cost breakdown in a Reddit post showed that, over 18 months, interest alone could amount to ÂŁ8,500, plus arrangement and legal fees topping ÂŁ10,000
5. Regulated vs Unregulated
- Regulated loans apply when the property is (or will be) your main residence, subject to FCA rules
- Unregulated loans are used for investment, commercial or development purposes
6. The Application Process
Step 1 : Define your exit strategy
Lenders require a clear repayment plan, such as selling the property or refinancing into a mortgage
Step 2 : Speak to a specialist broker
They compare lenders, negotiate rates and navigate the process, highly recommended.
Step 3 : Prepare documentation
You’ll need ID, proof of address, bank statements, asset details and exit‑plan evidence.
Step 4 : Valuation & legal work
Lender arranges valuation and instructs legal counsel; solicitors will set up the security charge
Step 5 : Drawdown
After legal checks, funds are released, often within 5-14 working days
7. Pros & Cons Compared
âś… Pros :
- Lightning-fast access to funds
- Flexible application criteria
- Useful for auctions, chain gaps and unmortgageable properties
❌ Cons :
- High interest and fees
- Short terms mean tight repayment deadlines
- Potentially devastating if exit strategy fails
8. Why Choose Empreso ?
At Empreso, we offer :
- Specialist bridging advice via expert brokers
- Access to a wide range of lenders and flexible deals
- End-to-end support, from exit planning to drawdown and beyond
We ensure your strategy is clear, realistic, and aligned with your goals.
9. Useful Tools & Resources
- Bridging cost calculator (monthly interest, fees)
- Exit strategy checklist
- Regulated vs unregulated mortgage guide
âś… Next Steps
🚀 Let’s secure your funding quickly—safely and smartly
📞 Book your free Clarity to Prosperity™ Review to discuss your needs
🧾 Gather documentation : ID, proof of address, bank statements, exit plan