FAQ
Frequently Asked Questions
How do I start the bridging finance application process?
Begin by engaging a specialist bridging finance broker who can assess your business or property use case, recommend suitable lenders, and guide you through required documents and eligibility checks.
What documentation do I need to apply?
You’ll typically need ID and proof of address, property details, evidence of equity, and your exit strategy (e.g. sale plan or refinance). Additional info may be needed for development or complex deals.
What factors do lenders consider during underwriting?
Lenders assess equity in the property, the viability of your exit strategy, credit risk profile, and property type/location. They focus on the location and security value over personal financials.
How long does it take from application to funds being released?
For straightforward applications with clear exit plans, funds can be released in as little as 3 to 10 working days, sometimes within 24–48 hours for the approval stage.
How is the interest calculated on a bridging loan?
Bridging interest is typically monthly and can be rolled up into the loan balance (rolled‑up interest) or paid monthly. If repaid early, any unused interest may be refunded.
What documentation do I need to apply?
You’ll typically need ID and proof of address, property details, evidence of equity, and your exit strategy (e.g. sale plan or refinance). Additional info may be needed for development or complex deals.
How is lender consent for a second-charge loan obtained?
If you already have a mortgage, your first-charge lender must consent to the second charge. A broker assists in formally notifying them and securing approval before proceeding.
What types of valuation are used?
Depending on complexity, lenders may conduct a full survey, drive‑by appraisal, or desktop valuation to verify the collateral’s worth and inform the LTV decision.
Do I pay fees upfront or on completion?
You pay arrangement, valuation, legal, and exit fees either out of loan proceeds or directly. Some costs—like valuation or legals may require upfront payment if not covered in the loan.
Are there legal steps involved and what are they?
After approval, a solicitor will handle legal title checks and register the charge. Your solicitor and lender’s solicitor will coordinate paperwork before funds are released.
What is an unregulated bridging loan for business property?
An unregulated bridging loan is a short-term, property-backed loan specifically used for business or investment purposes. Because it’s not secured against a property you or your family inhabit, it falls outside FCA regulation—but can close much faster than a traditional mortgage
What’s the difference between first charge and second charge bridging loans?
A first charge loan sits as the primary mortgage on the property, while a second charge is taken in addition to an existing mortgage. Second charge bridging allows you to release equity without disturbing your first lender.
Can second charge bridging be used for any business-related purpose?
Yes. Second charge bridge loans funded on business property can be used for virtually any commercial need—working capital, tax bills, stock financing, property deposits, refurbishments or business expansion.
How long do unregulated bridging loans typically run?
Loan terms commonly range from 1 to 24 months, with some lenders going up to 36 months. Most brokers recommend planning slightly longer than needed, since unused interest is usually refunded if repaid early.
How quickly can bridging finance complete?
With a strong proposition and exit strategy, funds can be released within 3 to 10 working days—some lenders even offer same-day decisions and fast turnaround for auction purchases or chain breaks.
Who is bridging finance suitable for?
It’s ideal for property investors, developers and business owners needing speed over traditional lending timelines. Common uses include auction purchases, chain‑break buys, un-mortgageable property, refurb funding, capital raise or commercial cash flow injections.
What security can lenders accept for these loans?
Most lenders accept residential, commercial, mixed-use or even land with planning consent. They focus on the exit plan—not just the borrower’s creditworthiness—especially for unregulated, business-purpose loans
Are bridging loan costs high and what fees are involved?
Bridging is usually more expensive than conventional finance. Expect arrangement fees (1–2 %), valuation and legal fees, plus high monthly interest (typically 0.5–1 % per month). Some interest may be “rolled‑up” into the loan if not serviced regularly
What makes a solid exit strategy for a bridging loan?
Lenders prioritise a credible exit route—such as property sale, refinance with traditional mortgage, or sale of assets. Clear repayment plans reduce risk and can lower rates or fees, while open-ended loans are discouraged due to higher costs and risk exposure
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