A bridging loan is a short-term loan typically used to cover a gap between buying a new property and selling an existing one. It’s secured against property and repaid either when the old property is sold or when long-term financing becomes available.
These loans are popular among property buyers who need to move quickly—especially in competitive markets—but don’t yet have the funds from a sale or another source.
Unlike standard mortgages, bridging loans are much faster to arrange—sometimes within days. This speed gives you a competitive edge in time-sensitive situations.
They’re also more flexible with criteria. While traditional lenders focus heavily on income and credit history, bridging lenders primarily consider the asset being secured and your exit strategy (how you’ll repay the loan).
Bridging loans can be expensive. Interest is usually charged monthly, and fees can be higher than traditional finance. That said, when used strategically, the value they provide can outweigh the costs—especially if they help you secure a property or opportunity you’d otherwise miss.
Clear communication with your broker or adviser is essential. Make sure you understand the total cost, repayment schedule, and potential risks.
They’re not for everyone. Bridging finance is best suited for those with a strong exit plan—such as a property sale or agreed mortgage—and a need for speed. Without a reliable repayment strategy, the risks can outweigh the benefits.
An experienced mortgage adviser can help you weigh your options and determine whether bridging finance is the right fit.