If you’re in the middle of a property deal and need funding quickly—without waiting weeks for a traditional mortgage—bridging finance could be the perfect solution.

But what exactly is a bridging loan? How does it work? And when is it the right option?

In this guide, we’ll break down everything you need to know about bridging finance in 2025, including real-world examples, the pros and cons, and how Willow Private Finance helps clients secure short-term funding with speed and confidence.

What Is Bridging Finance?

Bridging finance is a short-term loan used to “bridge the gap” between a pressing need for funding and a longer-term financial solution (like a mortgage, sale, or refinance).

These loans are typically:

• Secured against property
• Short term (usually 3–18 months)
• Interest-only
• Repaid in full at the end of the term

They’re ideal when time is of the essence or traditional lenders can’t move fast enough.

Common Uses for Bridging Loans

Bridging finance is incredibly flexible. Here are the most common scenarios we see at Willow:

1. Buying a Property Before Selling Your Current One
   Known as chain-breaking, this is the classic use case. You find your dream home but haven’t sold your current one yet. A bridging loan lets you complete the purchase, then repay the loan once your existing property sells.
2. Buying at Auction
   Auction purchases require quick completion—often within 28 days. Most high street mortgages can’t meet that deadline. Bridging finance allows you to complete on time and refinance later.
3. Renovating a Property
   If the property is uninhabitable or lacks a functioning kitchen/bathroom, most banks won’t lend. Bridging finance can fund the refurbishment. Once the property meets lender criteria, you refinance with a standard mortgage.
4. Funding a Development Project
   Bridging is often used to finance land purchases, light development, or even ground-up builds. It’s fast, flexible, and can be tailored to project milestones.
5. Solving Probate or Inheritance Delays
   When an estate is tied up in legal process but funds are needed urgently—for tax, buyouts, or maintenance—a bridging loan against inherited property can unlock capital fast.
6. Business Purposes
   Some clients use bridging loans to raise capital secured against property, which can then be used to fund business expansion or pay tax liabilities.

How Bridging Finance Works: Step-by-Step

1. Enquiry & Case Assessment
   Willow quickly reviews your needs and whether bridging is appropriate. We consider the value of the property, the exit plan, and timing.
2. Lender Match
   We identify the best-fit lender based on your property, credit profile, loan size, and timeline. This includes specialist lenders and private funders not available on the high street.
3. Valuation & Legal Work
   A valuation is arranged and solicitors begin title work. We work closely with legal teams to ensure everything moves quickly.
4. Funds Released
   Once contracts are ready, funds are released—often within 5–10 working days from application (or faster in urgent cases).
5. Exit Strategy
   The loan is repaid by selling the property, refinancing, or another agreed route.

Bridging Loan Example

Scenario:

Client in Surrey found a £2.1M property at auction but needed to complete within 21 days. Their residential sale was delayed.

Solution:

Willow arranged a £1.4M bridging loan secured on both the new and existing property. Funds were released in 8 working days. The bridging loan was later repaid via a high street mortgage once the original home sold.

Key Features of Bridging Loans

FeatureTypical Bridging LoanLoan Term3 to 18 monthsInterest TypeInterest-only (monthly or rolled-up)SecurityProperty (residential/commercial)SpeedOften within 5–10 working daysExit PlanSale or refinance

Pros and Cons of Bridging Finance

✅ Pros:

• Speed: Access to funds much faster than mortgages
• Flexibility: Used for purchases, refurbishments, or cashflow
• No monthly payments (if interest is rolled up)
• Available even with credit issues or complex income
• Bridges the timing gap between transactions

⚠️ Cons:

• Higher interest rates than traditional mortgages
• Short repayment period
• Valuation and legal fees still apply
• Exit strategy must be realistic and well-structured

How Much Does Bridging Finance Cost?

Costs vary depending on the lender, property, and client profile, but typical fees include:

• Interest rate: From 0.55%–1.2% per month
• Arrangement fee: Typically 1%–2% of loan amount
• Valuation fee: Based on property size/value
• Legal fees: Paid by both borrower and lender sides
• Exit fees: Not always charged—but worth checking

Willow helps clients keep costs down by negotiating directly and advising on efficient structuring.

When NOT to Use Bridging Finance

Bridging is powerful—but not always the right tool.

Avoid it if:

• You have no clear exit strategy
• The loan is covering long-term borrowing needs
• The property is not marketable or saleable
• You’re unsure about your ability to refinance or sell

A good broker will tell you when bridging is the wrong choice. At Willow, we always advise honestly.

Why Use a Broker for Bridging Finance?

Some bridging lenders work direct—but most don’t. And even if they do, working through a broker can make a major difference in speed, price, and structure.

Here’s how Willow helps:

• Access to over 100 bridging lenders, including private offices
• Deep experience structuring complex or multi-property cases
• Faster communication with underwriters
• Tight coordination with valuers and solicitors
• Clear guidance on exit strategy, costs, and timing

Final Thought

Bridging finance is a powerful tool when used correctly. Whether you’re breaking a chain, buying at auction, or seizing a time-sensitive opportunity, it can unlock doors that traditional lenders can’t open fast enough.

At Willow Private Finance, we specialise in delivering fast, flexible bridging loans that get deals over the line—without the stress.

📞 Need Fast Funding?

Get in touch with our bridging specialists today for a no-obligation assessment.