FAQs – Bridging

How much can I borrow with a bridging loan?

This is all determined by the value of the security so the higher the value of the property the more you can borrow.

There are options where you can put down between 20-25% deposit but 100% lending is available if you have additional property to secure against.

The lenders main concern is how are they going to get their money back and this would normally be by you either re-financing the property in question or selling it to pay them back.

The amount you can borrow is not affected by your personal income as you do not have to make any monthly payments.

Can I get 100% bridging?

Yes, you can. If there is enough security available then the lenders can even offer you kore than 100% of the purchase price of the property you want to buy.

The lender would take a charge over both properties or even more if necessary.

As an example you may want to purchase a new property but also have an existing property with a good level of equity in it. Let’s say that the property you wanted to buy was £250,000 and you had an existing property worth £300,000 with a mortgage of £50,000.

As an example you may want to purchase a new property but also have an existing property with a good level of equity in it. Let’s say that the property you wanted to buy was £250,000 and you had an existing property worth £300,000 with a mortgage of £50,000.

  • New purchase – £250,000
  • Existing property £300,000
  • Mortgage £50,000
  • Total equity – £500,000
  • Available gross loan – £375,000 (75% of the equity)

The lender would deduct the arrangement fee and the rolled up interest form the gross loan.

Best bridging rates / cheapest bridging?

Rates have come down a lot in the last few years. You can now get rates as low as 0.44% per month if you have enough equity or deposit.

Some lenders offer bespoke rates and we can play lenders off against each other to get you the best deal.

Auction finance – best auction finance rates?

Bridging is often used to purchase properties at auction either because it is much quicker than a standard mortgage or because the property is unmortgagable.

Auction houses often insist on a 28 day exchange which unfortunately can mean that most mortgage options don’t work.

Bridging lenders are far more flexible than standard mortgage lenders so properties in disrepair are not usually a problem.

Auction finance is basically the same as bridging finance and rates start at 0.44%