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Bridge Loan - Aria Finance

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Regulated Bridging Loans

Regulated bridging loans are designed for purchases, refurbishemnts or refinance of residential properties only.

Learn more

Unregulated Bridging Loans

A great solution for property professionals, landlords, investors and developers who need to ‘bridge a gap’ in a short time frame. 

Learn more

Refurbishment Loans

These bridging loans are an excellent option for light and heavy property refurbishment projects. 

Learn more
Send your enquiry: Request a quote

Key product features

  • Speed
  • Flexibility
  • Large loan sizes up to £30m+
  • No early repayment charges
  • Interest roll-up for zero-monthly payments
  • Up to 80 - 100% LTV available with additional security
  • Peace of mind that your clients' cases are being dealt with by industry-leading experts
  • Finance can be used to purchase or re-mortgage as a first or second charge loan
  • Loans can be secured against all property types: houses, flats, commercial units, land with planning, uninhabitable and un-mortgageable properties

Suitable when a borrower needs

  • Access to money quickly
  • Has adverse credit and declined on the high street for a traditional loan
  • To purchase an unmortgageable property
  • To bridge the gap between purchase and sale
  • To save a property chain break

Uses

There are many uses for bridging loans, here are just some of the many examples that might suit your needs.

A bridging loan is often a go-to funding option for experienced property professionals and property developers. 

Whether it's finance needed to purchase at auction, renovate a property, or even buy land, bridging loans are a quick and usually uncomplicated way to access the money when it's needed to capitalise on investment opportunities. 

find out more

When buying at auction, timing is everything. Whether the purchase is a residential property, semi-commercial or commercial premises or even land, bridging finance can offer access to finance fast to cover everything from the initial deposit required on the day through to the full purchase price. 

When buying property at auction in the UK, successful bidders typically need to have 10% of the purchase price ready to pay on the day. Full payment is usually due within 28 days, and a bridging loan is a common way of covering these costs to meet these deadlines.

find out more

One of the most popular uses of bridging finance is when it is used for a development exit. This short-term loan is perfect for helping property professionals and developers when timelines might not have gone to plan. 

If extra time is needed to finish a development, or perhaps it's not the right time to sell, but the loan needs repaying - a development exit could be the answer to bridge the gap and release some well-needed capital.

find out more

A refinance, often known as re-bridging, is simply an effective way to settle the term of an existing bridge and move onto a new bridging loan. 

If more time is needed on a project or the exit strategy has not gone to plan, it may be possible to extend the current bridging loan. However, if the existing loan cannot be extended, our team of bridging experts can help re-bridge onto a new loan.

find out more

Why choose Aria?

Over 20 years of experience

Our expert team have over 20 years of experience in bridging finance and the specialist distribution industry and works on your behalf to provide access to market-leading rates with rapid loan completion as standard.


  • We handle every element of your enquiry from application to completion to take the stress out of the mortgage process.
  • With one quick and easy call or online application, we can review your client's needs and work with a panel of lenders to tailor a finance solution perfect for their needs.
Send your enquiry: Speak to an Expert

Experts

20+ years in the industry

First class service

We handle every element of your enquiry from application to completion to take the stress out of the mortgage process

Access to 100+ lenders

Our extensive lending panel stretches across the high street, challenger banks, offering you unrivalled access to a wide range of products and rates

High conversion rate

With one quick and easy call or online application, we can review your client's needs and work with a panel of lenders to tailor a finance solution perfect for their needs

Point of contact

We offer one point of contact from enquiry through to completion, always aiming to make the process as smooth as possible

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A bridging loan is a short-term interest-only loan available to those that need access to capital quickly. Traditionally used for a property purchase, it is a loan to ‘bridge’ the gap while other finance (such as a mortgage or sale of property) is secured by the borrower. Bridging can also be used for a remortgage of a customers existing security or can be secured by way of a second charge. Bridging finance is secured, meaning the borrower uses property (or land) as security to the lending institution.

","broker_specific":0,"hs_child_table_id":0,"hs_created_at":1658324491663,"hs_deleted_at":0,"hs_id":79661456446,"hs_is_edited":false,"hs_published_at":1708095516058,"hs_updated_at":1664538347628,"hs_updated_by_user_id":25791956,"products":[{"id":1,"label":"bridging-loans","labelTranslations":null,"name":"bridging-loans","order":0,"type":"option"}],"question":"What is a Bridging Loan?","sub_category":{"id":1,"label":"The Basics","labelTranslations":null,"name":"The Basics","order":0,"type":"option"}},{"answer":"Anyone can apply for a bridging loan, either as an individual or a limited company.","broker_specific":0,"hs_child_table_id":0,"hs_created_at":1658401069161,"hs_deleted_at":0,"hs_id":79799294057,"hs_is_edited":false,"hs_published_at":1708095516058,"hs_updated_at":1662126252534,"hs_updated_by_user_id":25791956,"products":[{"id":1,"label":"bridging-loans","labelTranslations":null,"name":"bridging-loans","order":0,"type":"option"}],"question":"Who can apply for a Bridging Loan?","sub_category":{"id":1,"label":"The Basics","labelTranslations":null,"name":"The Basics","order":0,"type":"option"}},{"answer":"

Bridging loans are mainly used by clients who need quick, short-term capital to fund a property purchase. They include those who:

\n
    \n
  • Broken Property Chains - A bridging loan can be used to fix a broken property chain.
  • \n
  • Un-mortgageable - If a property is unmortgageable, such as a house without a kitchen or bathroom, borrowers can use a bridging loan to purchase it. 
  • \n
  • Renovations / Conversions - A bridging loan is an option if a borrower's goal is to renovate a property with the aim of adding value to sell at a higher price.
  • \n
  • Lease Extensions - Purchasing a property that has less than 80 years left on the lease can be challenging, as the banks may decline the mortgage.
  • \n
  • Planning Permissions - If your client wanted to purchase land or property for the sole purpose of getting planning permission (or use change) and then re-selling, a bridging loan could finance that transaction. Land with planning permission granted commands a higher value, so they could sell on for a profit or alternatively develop it themselves, exiting on to a development finance facility.
  • \n
  • Auction Purchases - When purchasing a property at an auction your client will usually have to pay a deposit 10% of the full price on the day of the auction - and will have up to 28 days to pay the remaining funds. A bridging loan can be very helpful when they need access to money fast, so many people use bridging loans for this purpose and then repay the loan once they have the mortagge.
  • \n
","broker_specific":0,"hs_child_table_id":0,"hs_created_at":1658401615635,"hs_deleted_at":0,"hs_id":79804998962,"hs_is_edited":false,"hs_published_at":1708095516058,"hs_updated_at":1664545260062,"hs_updated_by_user_id":25791956,"products":[{"id":1,"label":"bridging-loans","labelTranslations":null,"name":"bridging-loans","order":0,"type":"option"}],"question":"Who might need a Bridging Loans?","sub_category":{"id":1,"label":"The Basics","labelTranslations":null,"name":"The Basics","order":0,"type":"option"}},{"answer":"

There are many benefits to bridging loans such as speedy application, quick transfer and broader lending criteria - to name a few. Let's look at these and others in more detail. 

\n
    \n
  • Speedy Application Process
  • \n
  • Adaptive Lending Criteria
  • \n
  • Repayment Options 
  • \n
  • Condition of security properties not a factor
  • \n
\n

 

","broker_specific":0,"hs_child_table_id":0,"hs_created_at":1661418623252,"hs_deleted_at":0,"hs_id":82987640162,"hs_is_edited":false,"hs_published_at":1708095516058,"hs_updated_at":1664546369564,"hs_updated_by_user_id":25791956,"products":[{"id":1,"label":"bridging-loans","labelTranslations":null,"name":"bridging-loans","order":0,"type":"option"}],"question":"What are the benefits of bridging loans?","sub_category":{"id":1,"label":"The Basics","labelTranslations":null,"name":"The Basics","order":0,"type":"option"}},{"answer":"

We tend to see three main exit routes for bridging finance.

\n \n

1. Sale of property – The client may sell the property that the bridging finance has been secured against within the term of the loan to repay the bridging loan. This can also be the sale of an alternative property.

\n \n

2. Refinance – This could be the refinancing of the bridging loan with a mortgage or in some case another bridging loan from a different lender (a lender cannot write back-to-back bridging loans on the same property). This would usually need to be evidenced by an agreement in principle.

\n \n

3. Cash redemption – The client will need to evidence that a definite cash sum will be made available during the term of the loan, substantial enough to redeem the loan. 

\n

There are other exit routes that can be considered alongside these, as long as we are able to obtain evidence they will occur within the term and are deemed viable by the lender, consideration can be made.

","broker_specific":0,"hs_child_table_id":0,"hs_created_at":1661419078972,"hs_deleted_at":0,"hs_id":82981268008,"hs_is_edited":false,"hs_published_at":1708095516058,"hs_updated_at":1664547476444,"hs_updated_by_user_id":25791956,"products":[{"id":1,"label":"bridging-loans","labelTranslations":null,"name":"bridging-loans","order":0,"type":"option"}],"question":"What are viable exit routes for Bridging Finance?","sub_category":{"id":1,"label":"The Basics","labelTranslations":null,"name":"The Basics","order":0,"type":"option"}},{"answer":"

Ideally, this shouldn’t happen as the exit route will be a major part of the underwriting of the case at outset.

\n

The ability to repay the loan is a fundamental element to the loan being granted in the first instance, but circumstances can change during the loan – if they do and the exit cannot be achieved within the timescales, there are two options. The customer should give as much notice to the existing lender if they foresee any issues in redeeming their loan in time, and we can help to arrange another way of repaying the loan

\n \n

1 – Going back to the existing lender to extend the term. This will incur a new set of fees in line with arranging the original loan.

\n \n

2 – Rebridging to another lender – however, this will typically be more expensive because the client wasn’t able to exit the bridge within the original loan term and is therefore riskier. It's important to pay off the bridging loan before it expires to avoid paying expensive fees and penalties.

","broker_specific":0,"hs_child_table_id":0,"hs_created_at":1661419131523,"hs_deleted_at":0,"hs_id":82987640170,"hs_is_edited":false,"hs_published_at":1708095516058,"hs_updated_at":1664548042450,"hs_updated_by_user_id":25791956,"products":[{"id":1,"label":"bridging-loans","labelTranslations":null,"name":"bridging-loans","order":0,"type":"option"}],"question":"What happens if the client doesn't exit the bridge within the agreed term?","sub_category":{"id":1,"label":"The Basics","labelTranslations":null,"name":"The Basics","order":0,"type":"option"}},{"answer":"Retaining interest on the loan is a common feature of bridging finance. It gives the clients the option of borrowing the interest payments as part of the loan agreement. This means they then do not need to make monthly payments to the loan provider (which can be substantial), nor prove their affordability at the underwriting stage.","broker_specific":0,"hs_child_table_id":0,"hs_created_at":1661419174572,"hs_deleted_at":0,"hs_id":82981268013,"hs_is_edited":false,"hs_published_at":1708095516058,"hs_updated_at":1662126298251,"hs_updated_by_user_id":25791956,"products":[{"id":1,"label":"bridging-loans","labelTranslations":null,"name":"bridging-loans","order":0,"type":"option"}],"question":"What does retained interest mean?","sub_category":{"id":1,"label":"The Basics","labelTranslations":null,"name":"The Basics","order":0,"type":"option"}},{"answer":"If your clients choose to have the interest retained or rolled up, it is important to note what impact this will have on the net loan amount available to the borrower. 

If the client is looking to achieve the maximum loan to value available, interest and fees can generally only be added up to 75% maximum.

If the exceeds this threshold once interest and fees are added, they will be deducted from the loan instead.

For example, your client wants to borrow £100,000 at 75% LTV and interest rates will be 1% per month.

With a 12-month term and after 2% fees, the net loan amount will be £86,000 As the monthly interest payments of £12,000 and the fees will have to be deducted from the gross loan to ensure the entire borrowing does not exceed 75% loan to value.

It is important to note that the client will only ever pay for what they use. If they elect to retain interest on the loan, but are able to repay the loan before the end of the term they will receive a refund of unused interest.

Again, using the scenario above, if the client where able to repay the bridging loan in month six, and did not require the full 12-months, they would receive a refund of six months' unused interest payment; £6,000 in this example.","broker_specific":0,"hs_child_table_id":0,"hs_created_at":1661419246339,"hs_deleted_at":0,"hs_id":82981268015,"hs_is_edited":false,"hs_published_at":1708095516058,"hs_updated_at":1664548319207,"hs_updated_by_user_id":25791956,"products":[{"id":1,"label":"bridging-loans","labelTranslations":null,"name":"bridging-loans","order":0,"type":"option"}],"question":"What’s the impact of retained interest on a Bridging Loan?","sub_category":{"id":1,"label":"The Basics","labelTranslations":null,"name":"The Basics","order":0,"type":"option"}},{"answer":"A regulated bridge is if you’re securing funds against what is or will become your main residence, or your family intend to occupy the property. Or if the loan is secured on a property that has been inherited or has previously been occupied by yourself or family members. Unregulated is if you're securing funds against any property which is not your residence and will not become in the future. In terms of length, regulated bridging loans are up to a maximum of 12 months term whereas unregulated bridging loans can go to 24 months in some cases. Also, it's worth noting that some bridging lenders themselves are unregulated and can't offer FCA-regulated bridging loans. ","broker_specific":0,"hs_child_table_id":0,"hs_created_at":1661419307657,"hs_deleted_at":0,"hs_id":82987640359,"hs_is_edited":false,"hs_published_at":1708095516058,"hs_updated_at":1703070330310,"hs_updated_by_user_id":25791956,"products":[{"id":1,"label":"bridging-loans","labelTranslations":null,"name":"bridging-loans","order":0,"type":"option"}],"question":"What’s the difference between Regulated vs Unregulated Bridging Loans?","sub_category":{"id":1,"label":"The Basics","labelTranslations":null,"name":"The Basics","order":0,"type":"option"}},{"answer":"For regulated bridging loans your most competitive rate starts at 0.45% per month, for unregulated bridging rates start at 0.47% per month (as of Sept 2022).","broker_specific":0,"hs_child_table_id":0,"hs_created_at":1661419342795,"hs_deleted_at":0,"hs_id":82987640360,"hs_is_edited":false,"hs_published_at":1708095516058,"hs_updated_at":1664548342881,"hs_updated_by_user_id":25791956,"products":[{"id":1,"label":"bridging-loans","labelTranslations":null,"name":"bridging-loans","order":0,"type":"option"}],"question":"What interest rates can I expect with Bridging Loans?","sub_category":{"id":1,"label":"The Basics","labelTranslations":null,"name":"The Basics","order":0,"type":"option"}},{"answer":"The great flexibility of bridging often ties into the associated expense of bridging loans. Most lenders will allow borrowers the flexibility to pay the loan back at any time without penalties, as well as retaining interest into the loan so that cash outflows can be managed, and to secure on most types of properties including houses, flats, commercial units, land with planning, uninhabitable, and un-mortgageable properties.","broker_specific":0,"hs_child_table_id":0,"hs_created_at":1661419370079,"hs_deleted_at":0,"hs_id":82981268016,"hs_is_edited":false,"hs_published_at":1708095516058,"hs_updated_at":1662126306466,"hs_updated_by_user_id":25791956,"products":[{"id":1,"label":"bridging-loans","labelTranslations":null,"name":"bridging-loans","order":0,"type":"option"}],"question":"How flexible are Bridging Loans?","sub_category":{"id":1,"label":"The Basics","labelTranslations":null,"name":"The Basics","order":0,"type":"option"}},{"answer":"

Unlike a standard, high street residential mortgage, bridging loans are underwritten with less focus on formal criteria, affordability and credit checks and more focus on the strength, viability and plausibility of the client’s exit strategy to pay off the loan and the quality of the asset offered as security - rather than the client’s ability to pay. 

Of course, there will still be formal identification checks in order to prove identification of borrowers to lenders.

","broker_specific":0,"hs_child_table_id":0,"hs_created_at":1661419384383,"hs_deleted_at":0,"hs_id":82987640361,"hs_is_edited":false,"hs_published_at":1708095516058,"hs_updated_at":1664548423246,"hs_updated_by_user_id":25791956,"products":[{"id":1,"label":"bridging-loans","labelTranslations":null,"name":"bridging-loans","order":0,"type":"option"}],"question":"How are Bridging Loans underwritten?","sub_category":{"id":1,"label":"The Basics","labelTranslations":null,"name":"The Basics","order":0,"type":"option"}},{"answer":"
\n
Using an established specialist finance distributor such as Aria Finance has multiple benefits including:
\n
\n
We can help save borrowers and brokers time researching the many choices and help them find the bridging loan better suited to their needs specifically. If bridging finance is a financial area you’re new to, this process could feel overwhelming
\n
\n
Through Aria Finance, you will be accessing a wide range of bridging finance lenders to ensure the client obtains the best possible terms. This research and product selection would be carried out on your behalf as part of the service we offer.
\n
\n
With 20 years of experience in specialist lending, our large business volumes mean we are close to lenders and sometimes offered exclusive rates that other providers and intermediaries can’t access. These long-term relationships mean we have an understanding of the underwriting requirements for each lender and will be able to get deals accepted and offered quickly, an essential feature of bridging finance.
\n
\n
You also can choose to let us handle your client’s application from the initial enquiry stage through to completion. You can choose to be as hands-on or off in this process as you wish.
\n
","broker_specific":0,"hs_child_table_id":0,"hs_created_at":1661419415578,"hs_deleted_at":0,"hs_id":82981268017,"hs_is_edited":false,"hs_published_at":1708095516058,"hs_updated_at":1662641636038,"hs_updated_by_user_id":25791956,"products":[{"id":1,"label":"bridging-loans","labelTranslations":null,"name":"bridging-loans","order":0,"type":"option"}],"question":"Why choose a Specialist Finance distributor instead of going direct to the lender?","sub_category":{"id":1,"label":"The Basics","labelTranslations":null,"name":"The Basics","order":0,"type":"option"}},{"answer":"Your client can borrow against residential, semi-commercial (such as a shop with residential units above it) and commercial properties - in any state, including half built or fire damaged. We can also arrange lending against land, with or without planning permission.","broker_specific":0,"hs_child_table_id":0,"hs_created_at":1662126475431,"hs_deleted_at":0,"hs_id":83780318300,"hs_is_edited":false,"hs_published_at":1708095516058,"hs_updated_at":1662126523443,"hs_updated_by_user_id":25791956,"products":[{"id":1,"label":"bridging-loans","labelTranslations":null,"name":"bridging-loans","order":0,"type":"option"}],"question":"Which types of property can a bridging loan be used for?","sub_category":{"id":2,"label":"Criteria","labelTranslations":null,"name":"Criteria","order":1,"type":"option"}},{"answer":"As bridging loans are for the short-term, each client must have a plan in place to pay off the loan. This is known as an ‘exit route’ or 'exit strategy'. A viable exit route is a must on all bridging loan applications. Typical strategies include sale of property or refinancing onto a longer term mortgage.","broker_specific":0,"hs_child_table_id":0,"hs_created_at":1662126529753,"hs_deleted_at":0,"hs_id":83780318304,"hs_is_edited":false,"hs_published_at":1708095516058,"hs_updated_at":1662126559203,"hs_updated_by_user_id":25791956,"products":[{"id":1,"label":"bridging-loans","labelTranslations":null,"name":"bridging-loans","order":0,"type":"option"}],"question":"What is an exit route?","sub_category":{"id":2,"label":"Criteria","labelTranslations":null,"name":"Criteria","order":1,"type":"option"}},{"answer":"A bridging loan can be taken out from one day up to 24 months.","broker_specific":0,"hs_child_table_id":0,"hs_created_at":1662126560867,"hs_deleted_at":0,"hs_id":83783571328,"hs_is_edited":false,"hs_published_at":1708095516058,"hs_updated_at":1664538389261,"hs_updated_by_user_id":25791956,"products":[{"id":1,"label":"bridging-loans","labelTranslations":null,"name":"bridging-loans","order":0,"type":"option"}],"question":"How long can a bridging loan be taken out for?","sub_category":{"id":3,"label":"Terms","labelTranslations":null,"name":"Terms","order":2,"type":"option"}},{"answer":"The minimum amount for a bridging loan is £26,000 and the maximum can be over £20m. The maximum is subject to LTV typically 75-80%. We work with lenders who will go to 100% LTV with additional security. At Aria Finance, we have vast experience in securing multi-million-pound loans.","broker_specific":0,"hs_child_table_id":0,"hs_created_at":1662126589047,"hs_deleted_at":0,"hs_id":83780318305,"hs_is_edited":false,"hs_published_at":1708095516058,"hs_updated_at":1664538482952,"hs_updated_by_user_id":25791956,"products":[{"id":1,"label":"bridging-loans","labelTranslations":null,"name":"bridging-loans","order":0,"type":"option"}],"question":"How much can my client borrow?","sub_category":{"id":3,"label":"Terms","labelTranslations":null,"name":"Terms","order":2,"type":"option"}},{"answer":"Our experience means that in most cases we will be able to confirm almost straight away whether your client’s application is likely to be successful.","broker_specific":0,"hs_child_table_id":0,"hs_created_at":1662126674389,"hs_deleted_at":0,"hs_id":83783984926,"hs_is_edited":false,"hs_published_at":1708095516058,"hs_updated_at":1662126692354,"hs_updated_by_user_id":25791956,"products":[{"id":1,"label":"bridging-loans","labelTranslations":null,"name":"bridging-loans","order":0,"type":"option"}],"question":"When will my client find out if their application has been successful?","sub_category":{"id":4,"label":"Applications Process","labelTranslations":null,"name":"Applications Process","order":3,"type":"option"}},{"answer":"From the initial enquiry through to completion, our average turnaround time is between two and three weeks.","broker_specific":0,"hs_child_table_id":0,"hs_created_at":1662126694344,"hs_deleted_at":0,"hs_id":83783984927,"hs_is_edited":false,"hs_published_at":1708095516058,"hs_updated_at":1662126716252,"hs_updated_by_user_id":25791956,"products":[{"id":1,"label":"bridging-loans","labelTranslations":null,"name":"bridging-loans","order":0,"type":"option"}],"question":"How long will an application take to complete?","sub_category":{"id":4,"label":"Applications Process","labelTranslations":null,"name":"Applications Process","order":3,"type":"option"}},{"answer":"

Fees will vary on a case-by-case basis depending on the customers' circumstances and loan requirements. Aria Finance will provide a quotation for your enquiry which will detail the fees that will be payable.

","broker_specific":0,"hs_child_table_id":0,"hs_created_at":1662126717726,"hs_deleted_at":0,"hs_id":83783984930,"hs_is_edited":false,"hs_published_at":1708095516058,"hs_updated_at":1664538669064,"hs_updated_by_user_id":25791956,"products":[{"id":1,"label":"bridging-loans","labelTranslations":null,"name":"bridging-loans","order":0,"type":"option"}],"question":"Can my client repay their bridging loan early?","sub_category":{"id":3,"label":"Terms","labelTranslations":null,"name":"Terms","order":2,"type":"option"}}],"offset":0,"total":20,"totalCount":20}
aria-questions-1

Bridging Loans

Frequently asked questions

What is a Bridging Loan?

A bridging loan is a short-term interest-only loan available to those that need access to capital quickly. Traditionally used for a property purchase, it is a loan to ‘bridge’ the gap while other finance (such as a mortgage or sale of property) is secured by the borrower. Bridging can also be used for a remortgage of a customers existing security or can be secured by way of a second charge. Bridging finance is secured, meaning the borrower uses property (or land) as security to the lending institution.

A bridging loan is a short-term interest-only loan available to those that need access to capital quickly. Traditionally used for a property purchase, it is a loan to ‘bridge’ the gap while other...

Who can apply for a Bridging Loan?
Anyone can apply for a bridging loan, either as an individual or a limited company.
Anyone can apply for a bridging loan, either as an individual or a limited company.
Who might need a Bridging Loans?

Bridging loans are mainly used by clients who need quick, short-term capital to fund a property purchase. They include those who:

  • Broken Property Chains - A bridging loan can be used to fix a broken property chain.
  • Un-mortgageable - If a property is unmortgageable, such as a house without a kitchen or bathroom, borrowers can use a bridging loan to purchase it. 
  • Renovations / Conversions - A bridging loan is an option if a borrower's goal is to renovate a property with the aim of adding value to sell at a higher price.
  • Lease Extensions - Purchasing a property that has less than 80 years left on the lease can be challenging, as the banks may decline the mortgage.
  • Planning Permissions - If your client wanted to purchase land or property for the sole purpose of getting planning permission (or use change) and then re-selling, a bridging loan could finance that transaction. Land with planning permission granted commands a higher value, so they could sell on for a profit or alternatively develop it themselves, exiting on to a development finance facility.
  • Auction Purchases - When purchasing a property at an auction your client will usually have to pay a deposit 10% of the full price on the day of the auction - and will have up to 28 days to pay the remaining funds. A bridging loan can be very helpful when they need access to money fast, so many people use bridging loans for this purpose and then repay the loan once they have the mortagge.

Bridging loans are mainly used by clients who need quick, short-term capital to fund a property purchase. They include those who:

  • Broken Property Chains - A bridging loan can be used to fix a broken...
What are the benefits of bridging loans?

There are many benefits to bridging loans such as speedy application, quick transfer and broader lending criteria - to name a few. Let's look at these and others in more detail. 

  • Speedy Application Process
  • Adaptive Lending Criteria
  • Repayment Options 
  • Condition of security properties not a factor

 

There are many benefits to bridging loans such as speedy application, quick transfer and broader lending criteria - to name a few. Let's look at these and others in more detail. 

  • Speedy Application...
What are viable exit routes for Bridging Finance?

We tend to see three main exit routes for bridging finance.

 

1. Sale of property – The client may sell the property that the bridging finance has been secured against within the term of the loan to repay the bridging loan. This can also be the sale of an alternative property.

 

2. Refinance – This could be the refinancing of the bridging loan with a mortgage or in some case another bridging loan from a different lender (a lender cannot write back-to-back bridging loans on the same property). This would usually need to be evidenced by an agreement in principle.

 

3. Cash redemption – The client will need to evidence that a definite cash sum will be made available during the term of the loan, substantial enough to redeem the loan. 

There are other exit routes that can be considered alongside these, as long as we are able to obtain evidence they will occur within the term and are deemed viable by the lender, consideration can be made.

We tend to see three main exit routes for bridging finance.

1. Sale of property – The client may sell the property that the bridging finance has been secured against within the term of the loan to...

What happens if the client doesn't exit the bridge within the agreed term?

Ideally, this shouldn’t happen as the exit route will be a major part of the underwriting of the case at outset.

The ability to repay the loan is a fundamental element to the loan being granted in the first instance, but circumstances can change during the loan – if they do and the exit cannot be achieved within the timescales, there are two options. The customer should give as much notice to the existing lender if they foresee any issues in redeeming their loan in time, and we can help to arrange another way of repaying the loan

 

1 – Going back to the existing lender to extend the term. This will incur a new set of fees in line with arranging the original loan.

 

2 – Rebridging to another lender – however, this will typically be more expensive because the client wasn’t able to exit the bridge within the original loan term and is therefore riskier. It's important to pay off the bridging loan before it expires to avoid paying expensive fees and penalties.

Ideally, this shouldn’t happen as the exit route will be a major part of the underwriting of the case at outset.

The ability to repay the loan is a fundamental element to the loan being granted in...

What does retained interest mean?
Retaining interest on the loan is a common feature of bridging finance. It gives the clients the option of borrowing the interest payments as part of the loan agreement. This means they then do not need to make monthly payments to the loan provider (which can be substantial), nor prove their affordability at the underwriting stage.
Retaining interest on the loan is a common feature of bridging finance. It gives the clients the option of borrowing the interest payments as part of the loan agreement. This means they then do not...
What’s the impact of retained interest on a Bridging Loan?
If your clients choose to have the interest retained or rolled up, it is important to note what impact this will have on the net loan amount available to the borrower. 

If the client is looking to achieve the maximum loan to value available, interest and fees can generally only be added up to 75% maximum.

If the exceeds this threshold once interest and fees are added, they will be deducted from the loan instead.

For example, your client wants to borrow £100,000 at 75% LTV and interest rates will be 1% per month.

With a 12-month term and after 2% fees, the net loan amount will be £86,000 As the monthly interest payments of £12,000 and the fees will have to be deducted from the gross loan to ensure the entire borrowing does not exceed 75% loan to value.

It is important to note that the client will only ever pay for what they use. If they elect to retain interest on the loan, but are able to repay the loan before the end of the term they will receive a refund of unused interest.

Again, using the scenario above, if the client where able to repay the bridging loan in month six, and did not require the full 12-months, they would receive a refund of six months' unused interest payment; £6,000 in this example.
If your clients choose to have the interest retained or rolled up, it is important to note what impact this will have on the net loan amount available to the borrower. If the client is looking to...
What’s the difference between Regulated vs Unregulated Bridging Loans?
A regulated bridge is if you’re securing funds against what is or will become your main residence, or your family intend to occupy the property. Or if the loan is secured on a property that has been inherited or has previously been occupied by yourself or family members. Unregulated is if you're securing funds against any property which is not your residence and will not become in the future. In terms of length, regulated bridging loans are up to a maximum of 12 months term whereas unregulated bridging loans can go to 24 months in some cases. Also, it's worth noting that some bridging lenders themselves are unregulated and can't offer FCA-regulated bridging loans. 
A regulated bridge is if you’re securing funds against what is or will become your main residence, or your family intend to occupy the property. Or if the loan is secured on a property that has been...
What interest rates can I expect with Bridging Loans?
For regulated bridging loans your most competitive rate starts at 0.45% per month, for unregulated bridging rates start at 0.47% per month (as of Sept 2022).
For regulated bridging loans your most competitive rate starts at 0.45% per month, for unregulated bridging rates start at 0.47% per month (as of Sept 2022).
How flexible are Bridging Loans?
The great flexibility of bridging often ties into the associated expense of bridging loans. Most lenders will allow borrowers the flexibility to pay the loan back at any time without penalties, as well as retaining interest into the loan so that cash outflows can be managed, and to secure on most types of properties including houses, flats, commercial units, land with planning, uninhabitable, and un-mortgageable properties.
The great flexibility of bridging often ties into the associated expense of bridging loans. Most lenders will allow borrowers the flexibility to pay the loan back at any time without penalties, as...
How are Bridging Loans underwritten?

Unlike a standard, high street residential mortgage, bridging loans are underwritten with less focus on formal criteria, affordability and credit checks and more focus on the strength, viability and plausibility of the client’s exit strategy to pay off the loan and the quality of the asset offered as security - rather than the client’s ability to pay. 

Of course, there will still be formal identification checks in order to prove identification of borrowers to lenders.

Unlike a standard, high street residential mortgage, bridging loans are underwritten with less focus on formal criteria, affordability and credit checks and more focus on the strength, viability and...

Why choose a Specialist Finance distributor instead of going direct to the lender?
Using an established specialist finance distributor such as Aria Finance has multiple benefits including:

We can help save borrowers and brokers time researching the many choices and help them find the bridging loan better suited to their needs specifically. If bridging finance is a financial area you’re new to, this process could feel overwhelming

Through Aria Finance, you will be accessing a wide range of bridging finance lenders to ensure the client obtains the best possible terms. This research and product selection would be carried out on your behalf as part of the service we offer.

With 20 years of experience in specialist lending, our large business volumes mean we are close to lenders and sometimes offered exclusive rates that other providers and intermediaries can’t access. These long-term relationships mean we have an understanding of the underwriting requirements for each lender and will be able to get deals accepted and offered quickly, an essential feature of bridging finance.

You also can choose to let us handle your client’s application from the initial enquiry stage through to completion. You can choose to be as hands-on or off in this process as you wish.
Using an established specialist finance distributor such as Aria Finance has multiple benefits including:
We can help save borrowers and brokers time researching the many choices and help them find...
Which types of property can a bridging loan be used for?
Your client can borrow against residential, semi-commercial (such as a shop with residential units above it) and commercial properties - in any state, including half built or fire damaged. We can also arrange lending against land, with or without planning permission.
Your client can borrow against residential, semi-commercial (such as a shop with residential units above it) and commercial properties - in any state, including half built or fire damaged. We can...
What is an exit route?
As bridging loans are for the short-term, each client must have a plan in place to pay off the loan. This is known as an ‘exit route’ or 'exit strategy'. A viable exit route is a must on all bridging loan applications. Typical strategies include sale of property or refinancing onto a longer term mortgage.
As bridging loans are for the short-term, each client must have a plan in place to pay off the loan. This is known as an ‘exit route’ or 'exit strategy'. A viable exit route is a must on all bridging...
How long can a bridging loan be taken out for?
A bridging loan can be taken out from one day up to 24 months.
A bridging loan can be taken out from one day up to 24 months.
How much can my client borrow?
The minimum amount for a bridging loan is £26,000 and the maximum can be over £20m. The maximum is subject to LTV typically 75-80%. We work with lenders who will go to 100% LTV with additional security. At Aria Finance, we have vast experience in securing multi-million-pound loans.
The minimum amount for a bridging loan is £26,000 and the maximum can be over £20m. The maximum is subject to LTV typically 75-80%. We work with lenders who will go to 100% LTV with additional...
When will my client find out if their application has been successful?
Our experience means that in most cases we will be able to confirm almost straight away whether your client’s application is likely to be successful.
Our experience means that in most cases we will be able to confirm almost straight away whether your client’s application is likely to be successful.
How long will an application take to complete?
From the initial enquiry through to completion, our average turnaround time is between two and three weeks.
From the initial enquiry through to completion, our average turnaround time is between two and three weeks.
Can my client repay their bridging loan early?

Fees will vary on a case-by-case basis depending on the customers' circumstances and loan requirements. Aria Finance will provide a quotation for your enquiry which will detail the fees that will be payable.

Fees will vary on a case-by-case basis depending on the customers' circumstances and loan requirements. Aria Finance will provide a quotation for your enquiry which will detail the fees that will be...

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