7 Reasons Why a Bridging Loan is Ideal in Property Development

Property development finance is available in a variety of forms to suit most requirements and budgets. Increasingly, bridging loans are being sought by property developers across the UK to fund large and small projects.

But what is it about the bridging loan that makes it such a popular choice?  Why are more investors choosing bridging loans over conventional property development finance than ever before?

  • Bridging Loans Are Fast

Bridging loans are one of the fastest-access lending streams available for property developers. From application submission to provision of the funds, it can take as little as 3 to 5 working days, making it an ideal option when time is a factor.

  • Bridging Loans Are Flexible

Most bridging loans are tailored to suit the exact requirements and budget of the borrower. Along with flexible repayment terms, it’s also possible to qualify for a bridging loan with a poor credit history, due to bridging finance being far more flexible than more traditional mainstream loans & because monthly payments are rarely required.

  • Bridging Finance Can Be Used for Almost Anything

Although most often used for a property purchase, a bridging loan can be used for almost any legal purpose. In addition, it’s also possible to secure a bridging loan against almost any type of property or land providing it covers the total cost of the loan with sufficient excess.

  • Competitive Borrowing Costs

Bridging loans are short-term loans, designed to be repaid within a matter of months, rather than years. Interest rates start from below 0.5% per month, coupled with minimal overall borrowing costs. Early repayment is also usually an option with bridging loans, without facing heavy penalties or levies.

  • Auction Property Purchases

One of the most common applications for bridging loans in the property development sector is for the purchase of auction properties. The funds required to purchase a property at auction can be made available quickly, with the loan subsequently being repaid in one lump sum when the property is sold or refinanced.

  • Purchasing Uninhabitable Properties

Many mainstream lenders will only issue loans against properties that are considered habitable at the time of the application. With bridging finance, it is possible to secure a loan against an uninhabitable property, with the intention of renovating or redeveloping it.

  • No Deposit Required

Another benefit of bridging finance is the way in which no physical deposit is often required to set up the loan as additional security can be used to cover this. Eligibility is determined primarily on the value of the property or land used to secure the loan.

For more information on the benefits of bridging loans as a form of property development finance, contact a member of the team at UK Property Finance anytime.


Bridgingloans.co.uk is a trading style of UK Property Finance Ltd which is authorised and regulated by The Financial Conduct Authority (FCA) FRN no 667602. Think carefully before securing debts against your home. Your property could be repossessed if you do not keep up repayments on your mortgage or on any other debt secured on it. The team at UK Property Finance have many years of experience in all types of regulated and unregulated property finance, in-particular bridging finance and property development finance. Not all property finance products are regulated by the Financial Conduct Authority.

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