Bridging Finance in City of London

Bridging finance is a short-term secured loan designed to bridge the gap between an immediate funding need and a longer-term finance solution. It is typically used when speed is essential, such as completing an auction purchase within 28 days, breaking a property chain, funding a refurbishment project, or acquiring a property that does not yet qualify for a traditional mortgage. In the City of London, bridging finance is commonly used by property investors and developers who need to move quickly in a competitive market.

We can arrange bridging finance for City of London properties in as little as 5 working days from application to completion. Standard cases typically complete within 7-10 working days. The speed depends on several factors including the property type, LTV required, valuation turnaround, and legal complexity. For very straightforward cases with clean title and a desktop valuation, completion in 3-5 days is achievable with our fastest lenders.

Bridging finance rates for City of London properties currently start from 0.55% per month (6.6% per annum) for first charge loans. Rates depend on the Loan to Value ratio, property type, loan term, exit strategy, and borrower profile. City of London properties often attract favourable rates due to strong underlying values and high demand. Rates are typically calculated on a monthly basis and can be serviced (paid monthly) or rolled up (added to the loan balance).

Bridging loans for City of London properties are available up to 75% Loan to Value (LTV) on a first charge basis. The minimum loan amount is typically £100,000, with no maximum in principle, although most individual facilities range from £100,000 to £25 million. For higher LTV requirements, we can arrange second charge bridging loans or combine bridging with mezzanine finance to achieve up to 80-85% LTV.

Regulated bridging finance is governed by the Financial Conduct Authority (FCA) and applies when the loan is secured against a property that is, or will become, the borrower's primary residence. It includes consumer protections such as a 14-day reflection period. We are not FCA-authorised, so for regulated cases we introduce you to an FCA-authorised partner firm who carries out the regulated activity. Unregulated bridging finance applies to investment properties, commercial properties, and properties held in a company or SPV structure. It does not require FCA regulation, we arrange it directly, and it can typically be arranged faster as there are fewer regulatory requirements.

Bridging lenders for City of London properties accept several exit strategies: sale of the property (the most common exit), refinance onto a buy-to-let mortgage, refinance onto a commercial mortgage, sale of another property, development finance (if bridging is being used to acquire a development site), and inheritance or other capital receipts. The strength and credibility of your exit strategy is one of the most important factors in securing competitive bridging finance terms.

Absolutely. Bridging finance is the most common funding method for auction purchases and we regularly fund auction completions across the City of London. Once the hammer falls, you typically have 28 days to complete the purchase. We can secure bridging finance in as little as 5 working days, giving you comfortable headroom within the auction deadline. We recommend arranging a Decision in Principle before the auction so you can bid with confidence.

Bridging finance fees typically include: an arrangement fee of 1-2% of the loan amount, a valuation fee (£500-£3,000 depending on property value), lender legal fees (from £1,500), and broker fees. Some lenders charge an exit fee of 1-1.25%, although we frequently negotiate exit-fee-free facilities. All fees are disclosed transparently in the terms sheet before you commit. For City of London properties, the total cost of a typical bridging facility is 2-4% of the loan amount plus monthly interest.

Yes, bridging finance is available for all types of commercial property in the City of London including offices, retail units, restaurants, pubs, warehouses, and mixed-use buildings. Commercial bridging typically offers up to 70% LTV at rates from 0.65% per month. Lenders assess commercial bridging applications based on the property's value, your exit strategy, and the overall lending proposition rather than rental income, which makes it more flexible than commercial mortgages.

Unlike traditional mortgages, bridging finance does not primarily rely on income assessment. Lenders focus on the property value, your equity contribution, and the strength of your exit strategy. This makes bridging finance accessible to a wider range of borrowers, including self-employed individuals, company directors, overseas nationals, and those with complex income structures. However, lenders will want to see that your exit strategy is realistic and achievable within the agreed term.