A bridging loan is a short-term, secured loan used to bridge a gap in finance, most commonly when buying a new property before an existing one has been sold, or when funds are needed quickly and a standard mortgage would take too long to arrange.
Bridging loans are typically secured against property and arranged for a matter of weeks or months rather than years, with the loan repaid in full once the borrower’s longer-term finance (such as a mortgage or the proceeds of a property sale) comes through. They’re often used for chain breaks, auction purchases, uninhabitable properties that don’t qualify for a standard mortgage, or short-notice completions. Because bridging finance is secured against your property and works differently to a standard mortgage, it’s worth getting independent advice before committing, so you understand the exit route and how the loan will be repaid.