Bridging loan lenders assess three main criteria:
- the property used as security
- a credible exit strategy showing how you’ll repay
- the loan-to-value (LTV) ratio
With bridging your credit history carries less weight than with a mortgage. The stronger your security and exit plan, the better your rates and terms.
You’ve found a property at auction, spotted an investment opportunity, or need to move quickly before your current home sells. A bridging loan could give you the short-term finance to make it happen. But before any lender releases funds, they need to be satisfied that the deal stacks up.
Bridging lenders think quite differently from mortgage providers.
They care less about your salary and more about the asset, the risk, and how you plan to repay. If you don’t understand what they’re looking for, your application could stall or get turned down entirely. Most bridging deals need to complete within days or weeks, so a rejected application often means losing the opportunity altogether.
Knowing how lenders think puts you in a much stronger position. The sections below cover each assessment area in detail, the costs involved, and what you can do before applying to improve your chances.
How Do Bridging Loan Assessments Differ From Mortgages?
If you’ve only ever applied for a residential mortgage, bridging will feel like a different world.
Mortgage lenders spend a lot of time on your income, employment status, and monthly outgoings. They run detailed affordability checks and stress-test your ability to keep up with payments over 25 or 30 years.
Bridging lenders take a different approach.
Because the loan is short-term, usually lasting between 3 and 24 months, your monthly earnings are far less relevant. According to Bridging Trends data published by MT Finance, the average bridging loan term has remained at 12 months for nine consecutive years.
What matters is the security you’re putting up and whether your plan to repay the loan is realistic and achievable within the agreed timeframe.
Asset-Based Lending
Bridging finance is sometimes called “asset-based lending” because the property or asset you offer as security is the primary factor in the lender’s decision. Your income might not even be checked if your exit strategy is a property sale rather than a remortgage.
That said, a credit check is still part of the process. Lenders are looking for fraud markers and signs of financial distress rather than expecting a perfect credit score. Some will consider applications from borrowers with adverse credit, including CCJs, defaults, or even previous bankruptcies, provided the security and exit strategy are strong enough.
Related reading: What Checks Do Bridging Loan Companies Carry Out?
What Are the Three Main Criteria for a Bridging Loan?
Every bridging lender, from large institutions to private funds, assesses applications against three core criteria. Understanding each one will help you prepare a stronger application.
What Security Do Bridging Lenders Require?
Your security is the property or asset that the lender takes a legal charge over. If you can’t repay the loan, the lender can sell this asset to recover their money. Because of this, the quality and value of your security are the single most important factors in any bridging application.
Lenders will commission an independent valuation of the property, looking at both its open market value and its 90-day forced sale value. First charge lending accounted for 89% of all bridging loans in 2025, according to Bridging Trends data, which shows how central property security is to the lending decision.
The forced sale value matters because if the lender ever needs to repossess, they’ll want to sell quickly, and that usually means accepting a lower price.
Bridging lenders accept a broader range of property types than mortgage providers.
You can secure a bridging loan against residential homes, commercial premises, mixed-use buildings, land with or without planning permission, and even properties in poor condition that wouldn’t qualify for a mortgage.
This is a key difference from high street lending, where the property usually needs to be habitable and in standard condition.
You can also use more than one property as security if a single asset doesn’t provide enough equity. For example, if you’re buying a £500,000 property and need a higher loan amount, you might offer your existing home or a buy-to-let property as additional security. This is known as cross-charging.
Read more: Cross Charge Bridging Loans Explained
Why Is Your Exit Strategy So Important?
Your exit strategy is the plan you present to the lender showing exactly how you’ll repay the bridging loan before the term ends.
Lenders place significant weight on this because, unlike a mortgage, there are no ongoing monthly capital repayments reducing the balance. The full loan amount needs to be cleared in one go at the end of the term.
Common exit strategies include selling the property, refinancing onto a longer-term mortgage, receiving funds from a confirmed source such as an inheritance or business sale, or completing a development project and selling the finished units.
Investment purchases accounted for 20% of all bridging loans in 2025, with heavy refurbishment projects making up 11%, according to Bridging Trends data. Both of these exit routes rely on either a sale or refinance to clear the loan.
The stronger your exit strategy, the better your terms will be.
A vague plan like “I’ll probably sell the property” isn’t enough. Lenders want evidence.
If your exit is a property sale, they’ll want to know the property is marketable and priced realistically. If you’re refinancing, they may ask for a mortgage agreement in principle from another lender, proving you’ll qualify for the long-term finance needed to clear the bridge.
For property developers, the exit might involve selling completed units. In this case, lenders will look at local market conditions, comparable sales evidence, and your track record as a developer.
Loan-to-Value Ratio
The loan-to-value (LTV) ratio is the percentage of the property’s value that the lender is willing to advance.
Most bridging lenders cap their LTV at 75%, meaning you’ll need at least 25% equity or deposit in the deal.
In practice, the average LTV across the market was 55% in 2025, down from 58% the previous year, according to Bridging Trends data. This suggests borrowers are putting more equity into their deals than the maximum lenders allow.
For a property valued at £600,000, a 75% LTV would give you a maximum loan of £450,000. The remaining £150,000 would come from your own funds or equity in another property.
Lower LTV applications are seen as less risky by lenders, so they often attract better interest rates and terms.
If you can put more equity into the deal, it’s worth doing so. Some lenders will go up to 80-85% LTV in certain circumstances, but this is less common and usually requires additional security or a particularly strong exit strategy.
Let’s talk bridging loans!
What Other Factors Affect a Bridging Loan Application?
Beyond the three main pillars, bridging lenders look at several secondary factors that can influence their decision and the terms they offer.
Your Credit History
Credit flexibility is one of the big advantages of bridging finance, but your credit file still plays a role.
A clean credit history with no adverse markers will open up more lenders and better rates. If you have CCJs, defaults, or missed payments on your record, fewer lenders will be available, and rates are likely to be higher.
Some specialist lenders focus on adverse credit cases and will look past historic problems if the security and exit are solid. Having a clear explanation for any credit issues also helps, as lenders are more understanding of one-off events like a divorce or business downturn than a pattern of financial mismanagement.
Read more: Can you get a bridging loan with bad credit?
Experience and Track Record
If you’re borrowing for a property investment or development project, lenders may ask about your experience. A seasoned investor with a portfolio of completed projects will find it easier to secure funding than a first-time developer attempting a large conversion scheme.
That doesn’t mean first-time investors can’t get bridging finance. Many lenders will consider less experienced borrowers, but they might offer a lower LTV or require a more detailed business plan for the project.
Related reading: First-Time Buyer’s Guide to Bridging Finance
Borrower Structure
Bridging loans are available to individuals, partnerships, limited companies, SPVs (special purpose vehicles), and even offshore entities.
The borrowing structure you choose can affect which lenders are available and what documentation you’ll need to provide.
If you’re borrowing through a limited company or SPV, most lenders will require a personal guarantee from the directors. This means you’re personally liable for the debt if the company can’t repay. It’s a standard requirement, but one you should take legal advice on before signing.
Read more: Getting a Bridging Loan Through Your SPV
Property Location
Where the property sits can also affect your application.
Most lenders prefer properties in urban areas with strong demand and good liquidity. Rural properties, Scottish Highlands locations, or assets in areas with lower buyer demand may face tighter criteria or higher rates.
A smaller number of lenders operate across the entire UK, but some restrict their lending to England and Wales only. Your broker should be able to identify which lenders cover the location you need.
How Can You Strengthen a Bridging Loan Application?
Now that you know what lenders assess, here are some practical steps to give your application the best chance of success.
Prepare Your Documentation Early
Gather your ID, proof of address, details of the property, and any supporting documents for your exit strategy before you start the application.
Bridging deals move quickly, and delays in providing paperwork can hold up the whole process. If your exit is a remortgage, get an agreement in principle from a mortgage lender ready to show the bridging provider.
Work With a Specialist Broker
The bridging market has over 150 lenders in the UK, each with different criteria, risk appetites, and pricing.
The total UK bridging loan book reached a record £10.3 billion at the end of 2024, according to the Bridging and Development Lenders Association (BDLA), with Q1 2025 completions hitting £2.8 billion alone.
High street banks don’t offer bridging loans, so you’ll be dealing with specialist lenders, many of whom only accept applications through brokers.
A good broker will know which lenders suit your circumstances, present your application in the best light, and negotiate better terms on your behalf. They can also help you structure your exit strategy in a way that satisfies lender requirements. Given the speed and complexity of bridging transactions, broker expertise can be the difference between a smooth completion and a missed deadline.
Be Realistic About Your Exit
Lenders reject applications when the exit strategy doesn’t add up.
If you’re planning to sell a property, make sure you’ve researched local market values and set a realistic asking price. If you’re refinancing, check that you actually qualify for the mortgage or long-term finance product you’re relying on.
Having a backup exit strategy also strengthens your position. For example, if your primary exit is a property sale but you also have the option to refinance as a fallback, lenders will see this as a lower-risk proposition.
What Does a Bridging Loan Cost?
Bridging loans come with several costs beyond the interest rate, and you should factor these into your sums before you apply.
Arrangement and Valuation Fees
Most lenders charge an arrangement fee of 2% of the loan amount, plus a valuation fee for the property valuation Legal fees are also payable on both sides, as you’ll need your own solicitor and the lender will appoint theirs. On a £450,000 bridging loan, for example, a 2% arrangement fee alone would add £9,000 to your costs, so these charges add up quickly.
Interest Payment Options
The average monthly interest rate on a bridging loan fell to 0.84% in 2025, down from 0.88% in 2024, according to Bridging Trends data. Interest on bridging loans can be handled in three ways, your actual options will depend on the lender.
Retained interest is deducted from the loan upfront, so you receive a slightly lower net advance but make no monthly payments. Rolled-up interest works differently: it’s added to the loan balance over the term and paid in full when you repay.
Serviced interest is the third option, where you pay the interest monthly, similar to a mortgage.
The right choice depends on your cash flow and the nature of your project. If the property won’t generate any income during the loan term, retained or rolled-up interest is usually the better fit.
Exit Fees
Some lenders charge an exit fee when you repay the loan, often equivalent to one month’s interest or around 1% of the loan amount. Not all lenders charge this, so it’s worth asking upfront.
When Might a Bridging Loan Not Be the Right Choice?
Bridging finance isn’t suitable for every situation.
If you don’t have a clear exit strategy, the costs and risks can escalate quickly. Interest on bridging loans is higher than on standard mortgages, and if your exit plan falls through and the loan term needs extending, you’ll face additional fees and charges that eat into your returns or equity.
Before committing, make sure you’ve considered the alternatives.
A mortgage with a faster turnaround, a personal loan, or even renegotiating the timeline on your property transaction might be more appropriate depending on your circumstances. A good broker will tell you honestly if bridging is the right choice, or if another product would serve you better. That honesty is worth more than a quick approval.
FAQ
Most bridging lenders have a minimum loan size of £50,000, although some start from £100,000 or higher. The amount you can borrow depends on the value of your security and the lender’s maximum LTV ratio. For a property worth £500,000 at 75% LTV, you could borrow up to £375,000.
Bridging loans can complete in as little as 5 to 14 working days, depending on the lender and how quickly the valuation and legal work are finished. The average completion time across the market was 43 days in 2025, according to Bridging Trends data, though well-prepared applications with experienced solicitors complete much faster.
Yes, some specialist lenders will consider applicants with adverse credit histories, including CCJs, defaults, and previous bankruptcies. You’ll likely face higher interest rates, and the lender will place more emphasis on your security and exit strategy. Working with a broker who knows the adverse credit market is the best approach.
No. Many borrowers choose retained or rolled-up interest, which means no monthly payments are required during the loan term. The interest is either deducted upfront or added to the loan balance and repaid at the end.
Bridging lenders accept a broad range of properties, including residential homes, commercial buildings, mixed-use premises, land, and even properties in poor condition. Some lenders will also consider non-standard assets such as high-value vehicles, jewellery, or artwork as additional security. The property needs to have sufficient value and be sellable if the lender ever needs to recover their funds.
Bridging loans are one of the most common ways to fund auction purchases. Auction finance accounted for 11% of all bridging loans in 2024, according to Bridging Trends data, up from 7% the previous year. Auctions usually require completion within 28 days, which is too fast for a mortgage but well within the timeframe for a bridging loan. You’ll need to arrange your finance before the auction or move very quickly afterwards.
