If you’re navigating a property transaction or need a quick financial solution, a bridging loan could offer the short-term finance you’re looking for. But before applying, it’s important to understand how long these loans last and whether they’re suitable for your situation.

So, what is the minimum term for a bridging loan?

In the UK, the shortest term typically starts from one month, but many lenders prefer a minimum of three to six months. The best term for you depends on your personal circumstances, your exit strategy, and how soon you can repay the loan.

The article is updated as of May 14 2025

Damian Youell

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1: We contact you and take down your details, income outgoings, name, address etc.

2: We will research the whole market and email you a detailed quote as well as a list of documents to proceed.

3: You upload the documents and information needed via our channel our online portal.

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How Do Bridging Loans Work in the UK?

A bridging loan is a short-term loan designed to cover financial gaps. It’s commonly used by homebuyers and property investors to secure property quickly—often when a property chain breaks or when purchasing a property at auction.

Unlike a traditional mortgage, bridging finance focuses more on the value of the property and the borrower’s exit strategy than their income. However, lenders will still check your credit history and may carry out credit checks to assess risk.

Key Details:

  • Minimum Loan Term: From 1 month; often 3 to 6 months is standard.
  • Maximum Loan Term: Up to 24 months, depending on the lender.
  • Loan Amounts: From a minimum loan size of £25,000 to larger loans exceeding £10 million for commercial property transactions.
  • Interest Rates: Monthly interest rates typically range from 0.5% to 1.5%, depending on the property type and borrower profile.
  • Repayment: Full repayment is usually required at the end of the term via the sale of property, a buy-to-let mortgage, or other viable exit routes.

When Is a Short-Term Bridging Loan Useful?

  • Buying an uninhabitable property or unmortgageable property.
  • Securing finance for property refurbishment (light or heavy).
  • Meeting tight deadlines for auction purchases.
  • Managing cash flow for business purposes or commercial purposes.
  • Facilitating investment in semi-commercial properties or investment property.

A bridging loan can also help businesses complete a management buyout or secure short-term working capital.

How to Choose the Right Loan Term and Facility

Selecting the right term depends on:

  • Your exit route: How and when will you repay the loan?
  • The security property value and sufficient equity available.
  • Your ability to cover monthly repayments or monthly interest payments.
  • Any outstanding mortgage or existing financial obligations.

If you have adverse credit or a bad credit score, expect to face higher loan interest rates and possible broker fees or arrangement fees.


Costs Involved in a Bridging Loan

It’s important to understand the full loan cost, which may include:

  • Arrangement Fee: Typically 1–2% of the loan amount.
  • Broker Fees: Charged by a specialist broker or bridging loan broker.
  • Exit Fee: Some lenders apply a charge when you repay the loan early.
  • Admin Fees and Application Fees: These cover processing the loan application and handling paperwork.
  • Legal Fees and Valuation Fees: Paid during the application process.

Consider using a loan calculator to understand total borrowing costs before proceeding.


What Types of Properties Can Be Used as Security?

Bridging loans can be secured against:

  • Residential investment properties
  • Commercial property and commercial land
  • Agricultural land, including land with planning permission
  • Additional properties offered as additional security

This flexibility makes bridging finance a popular form of borrowing for both individuals and businesses.

Understanding Regulated vs. Unregulated Loans

  • Regulated Loans: Covered by the FCA, mainly for residential property purchases.
  • Unregulated Loans: Often used for commercial purposes, investment purposes, or high-value property deals.

Always seek legal advice before entering an unregulated loan agreement, particularly if personal guarantees are involved.

Common Exit Strategies for Bridging Loans

Having a robust exit strategy is critical. Common options include:

A clear exit plan improves your chances of loan approval and can help secure a lower monthly interest rate.

Damian Youell

Feel Free To Start WhatsApp Chat With Us...

How We Work

1: We contact you and take down your details, income outgoings, name, address etc.

2: We will research the whole market and email you a detailed quote as well as a list of documents to proceed.

3: You upload the documents and information needed via our channel our online portal.

Feel Free to Contact Us

Frequently Asked Questions

1. Can I Get a Bridging Loan Without a Salary?

Yes, though most lenders will require proof of assets or a clear exit strategy. Check Salary Requirements for Bridging Loans for more.

2. What Deposit Do I Need?

Typically, lenders require a minimum deposit of 25% to 40%. Learn more about Deposit Requirements for Bridging Loans.

3. Are Bridging Loans Suitable for Pensioners?

Yes, if you have a clear loan exit strategy and can demonstrate how the loan will be repaid without affecting your retirement plans.

4. How Quickly Can I Get a Decision?

Some lenders offer instant decisions or a decision in principle within a matter of days, depending on the strength of your initial enquiry and documents provided.

5. What Happens If I Can’t Repay on Time?

You may face redemption penalties or even repossession of the property. This is why a solid exit strategy is vital.

Key Takeaways

  • Bridging loans typically start from 1 month term, with flexible options up to 24 months.
  • Understand all loan fees, including facility fees, broker fees, and exit fees before proceeding.
  • Work with an experienced loans team or dedicated team at a reputable brokerage to explore competitive products from a wide range of lenders.
  • Always assess the full loan balance, exit strategy, and repayment risks before applying.

Take the Next Step Today

Looking for fast, professional advice on bridging loans or pension planning? Book a Free Consultation with our experienced advisers.