Bridging Loan Companies

Company

Rating

All Products & Services

Loan Size

Loan Term

Interest Rate

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£50k to £3m

3 Months - 18 Months

0.75%

£75k-£15m+

1 Month - 3 Years

0.48-1.1%

£75k- £5m

1 Month - 24 Months

0.65%

£150k- £5m

3 Month - 15 Months

0.7-0.8%

£200k- £25m

1 Month - 24 Months

0.55%

£50k- £500k

1 Month - 18 Months

0.8-1%

£50k- £10m

1 Month - 24 Months

0.65%

£50k- £500k

3 Month - 24 Months

0.69%

£100k- £30m

3 Month - 24 Months

0.59-1.25%

£750k- £15m

1 Month - 24 Months

0.55-0.79%

What is

Bridging Loan?

A bridging loan is a type of short term loan that is used to bridge the gap if you want to purchase a new home before selling your old home. It is a property backed finance and is usually offered for a period of 1 to 18 months. In bridging loans you have to repay the full amount at the end of the loan term. The application process is simple and quick and the loan is usually approved in less time than a traditional mortgage. However, bridging loans are expensive and offer a high interest rate so you must keep this in mind before taking a bridging loan.

Bridging loans are also known as gap finance or swing loans are fast to arrange and allow you to take advantage of an opportunity by providing you instant cash. Having a mortgage or other traditional loans is a lengthy process and it takes months to get approval.

Bridging loans companies are often used to purchase a new home when you are waiting for the sale of your current property. However, it can be used for:

Moreover if you are a business owner and need some funds to maintain your cash flow you can consider business bridging loans.

Types Of Bridging Loan

Before getting a bridging loan it is important to know that there are two different types of bridging loans that are:

Open Bridging Loan

Such loans do not have any fixed end date when you have to repay the loan amount. These are used by borrowers who are not certain about when the finance will become available in future. For example if you want to buy a new home but you do not find any buyer to sell your current home. In this case an open bridging loan can be a great solution. It is also suitable for you if you are a property developer and need funds to renovate a property to increase its value. However, when you do not have any end due date you have to pay the loan amount within a year.

Closed Bridging Loan

Closed bridging loans have a fixed repayment period and you have to pay the loan amount on a predetermined date. Some borrowers precisely know when funds become available to repay the loan amount so they take a bridging loan with a fixed repayment date. Such loans have low interest rates as compared to open bridging loans. It is because in closed bridging loans lenders have more certainty and confidence. However, if the borrower fails to repay on time, the lenders will charge late repayment fees.

Bridging Loan Interest Rate

The interest rate on bridging loans can be fixed or variable just like traditional loans and mortgages. In fixed rate bridging loans the interest rate remains the same throughout the loan term. When you choose a loan with variable rate the interest rate can increase or decrease and you have to pay a lower or higher amount at the end. You have the option to pay the interest rate monthly or you can pay it at the end of the loan term. Moreover, you have another option known as retained payment in which you borrow interest rate for a set amount of time and pay it all back at the end of loan.

What Is First And Second Charge Bridging Loan?

When you borrow money through a bridging loan a charge is placed at your property. And if you fail to repay this legal agreement is used to decide which lender will be repaid first. If you already have a mortgage on your property, the bridging loan will be second charge. When your property is sold the amount is first paid to the mortgage lender and then to the bridging loan lender.

On the other hand when you do not have any mortgage you can have a first charge bridging loan. In this case if you default the bridging loan will be repaid first. You can borrow more with the first charge bridging loan as compared to the second charge bridging loan.

How Much Can You Borrow?

The amount, interest rate and loan term vary from lender to lender. However you can usually borrow an amount between £30,000 to £50 million. The amount you can borrow depends on the market value of the property that you are using as security. Same is in the case of loan to value , lenders offer 65 to 85% LTV, based on your circumstances. You can also get 100% LTV , subject to additional security.

Do You Need A Regulated Or Unregulated Bridging Loan?

You need to decide which bridging loan you want to get. So it is essential to know about regulated and unregulated bridging loans.

Regulated Bridging Loan

A regulated bridging loan is provided by a lender who is authorised and regulated by the Financial conduct Authority (FCA). There are a few lenders who are able to provide regulated bridging loans. With regulated loans you can get £100,000 to £5 million for a period of 12 months. However some lenders allow you to take upto £20 million for a period of 24 months. You can use this loan to purchase a property, downsizing, purchasing a property abroad, business uses, auction purchase, stopping repossession and paying a debt. These loans can be secured against houses, flats, bunglows, and for the properties that are in poor condition or unsuitable for mortgage.

Unregulated Bridging Loan

Lenders who are not authorised by FCA provide you with unregulated loans. Such loans can be secured against residential properties, retail units, development lands, offices, mix use properties and parking spaces. You can take a loan ranging from £100,000 to 1 billion for a period of up to thirty six months. There are dozens of lenders providing unregulated bridging loans but we suggest you take a loan from the reputable and FCA registered lender.

What is the Exit Route?

The exit route is the method through which you repay the loan amount. All the regulated bridging loans are approved on the basis of a clear exit strategy. Some lenders only accept the exit route based on property sale while others also accept the refinance. There are many bridging loan providers in the UK but it is essential to select one that offers you best rates and follows best lending practices. To help you we are providing information about the UK’s top bridging loan providers.

A bridge loan is a type of short term loan that is used to bridge the gap if you want to purchase a new home before selling your old home. It is a property backed finance and is usually offered for a period of 1 to 18 months. In bridingding loans you have to repay the full amount at the end of the loan term. The application process is simple and quick and the loan is usually approved in less  time than a traditional mortgage. However, bridging loans are expensive offering a high interest rate so you must keep this in mind before taking a bridging loan. 

There are many bridging loan providers in the UK but it is essential to select  one that offers you best rates and follow best lending practices. To help you we are providing information about the UK’s top bridging loan providers.

Kuflink

Kuflink was launched in 2011 as a bridging loan provider to property investors. With time the company has become a leading peer to peer lending and IFISA provider. What makes them stand out is their consistency. All their loans are secured against UK properties. They have no track record of default borrowers. Their interest rate never changes, that never goes down or up. This way you get what you are offered. The company has great customer service and treats their investors with utmost priority.

 

Kuflink offers bridging loans for commercial, semi-commercial, residential and auction purposes. You can borrow up to £3m and the loan term starts from 3 months.

Pros

Cons

United Trust Bank

The United Trust Bank was established in 1955. It is an established lender providing a wide range of secured funding facilities for individuals and businesses. It offers its products through a network of borrowers. These products include professional loan, bridging loans and asset finance. It is regulated by the Financial Conduct Authority and Prudential regulation Authority. The United Trust Bank offers bridging loans ranging from £75k to £15m+. The loan is secured against residential and mixed use property

Pros

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Mint Property Finance

Mint Property Finance is providing bridging loans over 10 years. Their loans are designed to bridge the gap between short term financial limitations and long term success. It offers five different loan products named as bridging , light and medium. The loan size varies from £75,000 to 2, 500,000 with an interest rate ranging from 0.65% to 0.70%. The loan term is up to 24months for all loan products.

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Pivot

Pivot was established in 2012 as a London-based property development business. By experiencing the challenges of raising finance Pivot was launched with a mission to make the borrowing process as easy as possible. It offers short term loans secured against residential properties and also provides loans for refurbishment purposes. The loan size varies from £150,000 to £5,000,000. You can repay the loan within a period of 3 months to 15 months.

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Octane Capital

Octane capital is relatively a new name to the name of Uk’s financial lenders and  was launched in 2017. It is providing bridging, buy to let, developer exit and refurbishment loans. It offers flexible loans that meet your requirements. You can take a loan ranging from £200,000 up to £25,000,000 for up to 24 months. Highly expert team of octane capital takes pride in getting to know the individual requirements of every borrower so that they can provide them with a product that suits them.

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Bridging Link

Bridging link is a trusted UK lender providing bridging loans to help a project keep moving. It has an expert team that has over 4o years of experience of providing loans to individuals and corporate businesses. The process of application is simple and quick. Once your loan is approved you can get access to cash within the shortest possible time. It offers bridging loans from £50,000 to £500,000 and they lend up to 60% loan to value. Bridging link offers fees and interest cost that is very competitive.

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MT Finance

MT Finance is a leading property finance lender, specialises in auction finance and bridging finance.  This company was set up in 2008 and from that time it is assisting individuals, business owners and property professionals with their financial requirements. It is an asset based lender so it does not judge loan application on credit history. You can take a bridging loan ranging from £50,000 to £10,000,000 for a period of 1-24 months.

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Hope Capital

Hope Capital is a specialist bridging loan provider. It has a reputation for finding a financial solution for you in a record quick time, when other providers can not do so. They provide  a loan with a clear exit route no matter how unusual or tricky a situation you have. It offers a range of loan products so that customers can take one that suits them the best. Bridging loans from £50,000 to £5,00,000 for a period of up to 18 months are available on Hope Capital.

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Market Finance Solution (MFS)

It is one of the UK’s independent bridging finance providers, it provides a wide range of flexible and fast bridging loans. MFS offers loans to private individuals and on a commercial basis based on the requirements of clients. It offers short term asset backed loans with a specific focus to support those seeking to expand their property portfolio. You can take a loan ranging from £100,000 to £10million for three months to 18 months.  They cover both residential and commercial properties and the interest rate varies with your requirements.

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LendInvest

LendInvest is a property finance company established in 2008. It has been working for more than 12 years with an aim of making property finance simple and easy. It has a wide range of products from buy to let mortgages to bridging loans. You can apply for a loan directly or through a broker. You can take a loan ranging from £7,50,000 to £15 million with a maximum loan to value 75%. The interest rate varies from 0.55 to 7.98%.

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