How Does a Bridging Loan in London Work?
Funding from £75,000 up to £25 million
Helping you secure a short-term financial solution to your specific bridging finance London requirements
How Does a Bridging Loan in London Work?
Bridging Loans in London – Fast, Flexible Property Finance
Need fast funds to secure a property in London?
A bridging loan gives you immediate access to short-term finance when speed matters most. Whether you’re buying before selling, purchasing at auction, or renovating a property, our expert team can arrange fast bridging finance London tailored to your needs.
Why Bridging Finance is Crucial in London
The London property market moves quickly. Opportunities often come with tight deadlines, and waiting for a traditional mortgage can mean missing out on your dream home or a profitable investment.
London Clients We Work With at Bridging Finance Now
Homeowners
Commercial & Residential Landlords
Buy to Let Investors
Business Owners
Property Developers
Company CEO’s
How Does a Bridging Loan in London Work?
A bridging loan in London is perfect when:
- You want to buy a new home before selling your current property.
- You need to complete an auction purchase within 28 days.
- A property is unmortgageable due to its condition and requires refurbishment.
- You are an expat or overseas investor needing fast access to funds.
- You’re a developer or landlord expanding your property portfolio.
Example: A London buyer spots a Victorian property at auction for £950,000. Completion is required within 28 days, but their current flat hasn’t sold. A bridging loan provides the funds instantly, and they repay it once their old flat sells.
What is a Bridging Loan?
A bridging loan is a short-term, secured loan designed to “bridge the gap” between your immediate financial need and a longer-term solution, like a mortgage or property sale.
Key features:
Speed: Funds available in 7–14 days (sometimes faster).
Short-term: Typically 1–24 months.
Flexible: Suitable for a wide range of residential and commercial property scenarios.
Secured loan: Backed by property or other assets.
Bridging loans are particularly popular in London because property values are high, and deals often need to be completed quickly.
How a Bridging Loan Works in London
Here’s a step-by-step breakdown of how the process works:
1. Initial Consultation
We assess your needs, property details, and exit strategy (how you’ll repay the loan). Common exit plans include selling a property, remortgaging, or refinancing.
2. Agreement in Principle (AIP)
You’ll receive an Agreement in Principle, showing sellers or auction houses you’re a serious, funded buyer.
3. Property Valuation
The lender arranges a valuation to confirm the property’s market value.
*Typical Loan-to-Value (LTV): Up to 70–80% of the property value.
4. Legal Work
Specialist solicitors handle the legal process, often completing in a few days, ensuring there’s no delay.
5. Receive Funds
Once approved, funds are released directly to your solicitor, allowing you to complete the purchase quickly.
6. Repay the Loan
You repay the bridging loan through your chosen exit strategy, such as selling the property or refinancing with a traditional mortgage.
Why Choose Us for Your Bridging Loan
London specialists: We understand the speed and complexity of the capital’s property market.
Fast decisions: Funding in as little as 7 days.
Tailored solutions: Whether you’re a homeowner, developer, or investor.
1. Closed Bridging Loan
Has a fixed repayment date. Ideal when you know exactly when funds from a sale or mortgage will be available.
2. Open Bridging Loan
No set repayment date but expected within 12 months. Suited to situations where timing is uncertain, such as waiting for a property to sell.
3. Regulated Bridging Loan
For properties you or your family will live in. Fully regulated by the Financial Conduct Authority (FCA).
4. Unregulated Bridging Loan
For investment or commercial purposes, such as buy-to-let or development projects.
Costs of a Bridging Loan in London
While bridging loans offer speed and flexibility, they come with higher costs compared to traditional mortgages.
- Cost Type Typical Range
- Monthly Interest Rate 0.55% – 1.5%
- Arrangement Fee 1% – 2% of the loan
- Valuation Fee £300 – £1,000+
- Legal Fees £500 – £2,000+
- Exit Fee (if applicable) 1% of the loan
Example:
Borrowing £500,000 for 6 months at 1% interest per month = £30,000 in total interest, plus arrangement and legal fees.
Common Exit Strategies
Having a clear exit strategy is essential when taking out a bridging loan. Typical repayment methods include:
Sale of a property – repaying the loan once a property is sold.
Remortgaging – switching to a longer-term mortgage after renovations or once mortgage approval is ready.
Development flip – selling the purchased property after refurbishment.
Portfolio refinancing – restructuring debts across multiple properties.
Benefits of Using a Bridging Loan in London
Fast access to funds – complete property purchases in days, not weeks.
Solve property chain breaks – move ahead with buying even if your sale is delayed.
Flexibility – fund auctions, renovations, or investment opportunities.
Unlock unmortgageable properties – buy and refurbish homes that need work before they qualify for a standard mortgage.
Competitive advantage – cash buyer status in London’s competitive market.
Case Study: Buying Before Selling
Problem: A London couple found their dream £1.2M home but hadn’t sold their current property yet.
Solution: A bridging finance London loan provided immediate funds to complete the purchase. Four months later, they sold their previous home, repaid the bridging loan, and avoided losing their ideal home.
Result: They avoided the stress of rushed selling and secured a better price for their old property.