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Use this free bridging loan calculator to get a detailed estimate of interest, charges and other costs of your bridging finance.
A bridging loan calculator gives you an idea of how much a bridging loan could cost, based on your circumstances such as how much you want to borrow, your property’s value and how long you want the loan for. This bridging loan calculator will also give indicative figures of any fees involved too, although when you apply for a bridging loan, these fees may vary.
Bridging loans are a way to borrow money in the short term and they can be used to ‘bridge the gap’ if you need to buy one property before selling another.
Bridging loans can be very fast to arrange compared to traditional mortgages. However, they are secured loans, this means you have to secure an asset against them, usually a property or properties. So think carefully before proceeding.
We’ve partnered with Chartwell Funding because of their excellent customer service. Established in 2007, the FCA regulated company have an experienced team of experts to help guide you through the process whatever your needs. And we’re delighted to announce that Chartwell have offered to waive their fee (usually £500) as an exclusive deal for HomeOwners Alliance users. You can contact Chartwell today by completing an enquiry form or speaking to a specialist broker at Chartwell Funding now on 01454 809 300
Bridging loans can be arranged for any legal purpose, some common examples are:
So what bridging loan criteria will you need to meet to be approved? Firstly, you’ll need to be:
And you’ll usually need to put up property as security. Examples of the types of security that can be used for a bridging loan include:
Simply use this bridging loan calculator to find out. The amount of loan you’ll be able to get will depend on the value of your property and your personal finances. The maximum loan, including any retained or rolled up interest is normally limited to 75% loan to value (this can be over multiple properties).
Your loan size may be limited depending on the condition of the property, your credit history, any essential works required at the property or the level of finance available to refinance.
In terms of how much will a bridging loan cost you, firstly you’ll need to consider the bridging loan interest rate you’ll pay and you’ll also need to factor in bridging loan fees and costs.
Bridging loan interest rates tend to be higher because bridging loans are a higher risk than a traditional mortgage and they’re designed to be short term. You can expect to pay anything from 0.52% per month, depending on your circumstances.
To get the best bridging loan interest rate you should always shop around and the easiest way to do this is by using a specialist bridging loan broker like Chartwell Funding. But there’s another important benefit of using a bridging loan broker; unlike standard mortgages, bridging loans interest rates can be negotiated – so by using a good bridging loan broker, you may get a better rate.
The bridging loan interest rate you’ll be able to access will depend on factors including your LTV, how you plan to repay the loan and the condition of the property. But for illustration, these are the typical starting point for bridging loan rates.
| Up to 55% | from 0.52% per month |
| Up to 65% | from 0.61% per month |
| Up to 70% | from 0.67% per month |
| Up to 75% | from 0.75% per month |
The key difference between bridging loan interest compared to standard mortgage interest is that interest rates are displayed as monthly for bridging finance. This is because bridging loans are typically between 12 and 18 month terms, and you pay interest on your monthly balance. And you’ll usually only pay interest for the duration of your loan. So, if you exit your bridging loan within 6 months, you’ll only pay 6 months’ worth of interest even if your original term was 12 months. And most lenders won’t charge you a fee if you pay off your loan early.
Unlike a traditional mortgage, there are three ways that the interest on a bridging loan is charged:
The exact fees you’ll need to pay will depend on the lender and your circumstances but here is what you’ll typically have pay.
Here is an example of how a bridging loan works. Let’s say you want to buy a house for £400,000 before you can sell your current property of £350,000 with a £50,000 mortgage secured against it. This means borrowing the full £400,000 and a 12-month bridging loan to give you enough time to sell. And, arranging a mortgage on your new property to cover the shortfall.
| Monthly Interest Rate: | 0.75% |
| Loan Term (Months): | 12 |
| Net Loan Amount: | £400,000.00 |
| Interest (if runs full term): | £38,273 |
| Arrangement fee (2%): | £8,000 (Added to loan) |
| Gross Loan Amount: | £446,273 |
| Amount | |
|---|---|
| Valuation Fee (Inc. VAT): | £1,759 |
| Telegraphic Transfer Fee: | £35 |
| Lenders Admin Fee: | £145 |
| Broker fee: (Free if you use Chartwell) | £500 |
| Estimated lender legal costs: | £2,000 |
| Redemption Admin Fee: | £40 |
| Grand total: | £450,252 |
By using a bridging loan broker, they can negotiate with lenders on your behalf to get a better deal. Also, if you’re buying a property before selling an existing one, it may be possible to reduce the cost of finance by using more than one security property. By securing your bridge loan over both properties in the transaction, your overall loan cost may be lower. However, if you have an outstanding mortgage on a property you’re using as security, it will be factored into the overall loan to value calculation.
Submit an enquiry form or if you want to speak to a specialist broker immediately call Chartwell Funding on 01454 809 300. They are open Monday – Thursday 09:00 – 19:00 and Friday 09:00 – 17:30.
Ordinarily yes, charging from £500 to thousands of pounds. But the experienced team of brokers at Chartwell Funding have offered to waive their fee (usually £500) as an exclusive deal for HomeOwners Alliance users.
Yes. Bridging loans can be secured as first or second charges, or even third charges, as long as there is still sufficient equity in the property.
This will always depend on your individual circumstances but generally speaking, as long as the LTV is 75% or below, based on the combined value of properties being used as security, then 100% bridging is possible.
You can complete an enquiry form or speak to a specialist broker at Chartwell Funding now on 01454 809 300
Or you can use the free online bridging loan calculator for detailed examples of all the costs associated with taking out a bridging loan instantly.
Yes. When you use a bridging loan broker, they’ll shop around on your behalf to get the best bridging loan for your needs but they’ll also be able to negotiate with lenders on your behalf to get a better deal.
Bridging loans are usually secured against property; the amount you’ll be able to borrow on a bridging loan will depend on the amount of equity you have in your property/properties. Use this bridging loan calculator to see how much you can borrow.
Some bridging loans can be arranged within as little as 48 hours from initial application. However, a timeframe of two to four weeks from start to finish is more typical.
Yes, most lenders allow you to repay your loan early without penalty. Where this happens, interest is usually only charged for the period where the funds were actually borrowed.
Secured loan usually means a loan that is secured by way of a legal charge over property owned by the customer. Secured loans are sometimes referred to as a second mortgage.
When you’re looking into bridging loans you’ll see the terms gross and net loans. The gross loan is the total amount borrowed including all the fees, charges and interest. The net loan is the amount of money release to you, not including any fees, charges of interest.
Closed bridging loans have a guaranteed exit date, or date when the loan will be repaid; for example if you’re buying a property this would be the completion date after you’ve exchanged contracts. Closed bridging loans are less risky to both the lender and the borrower so the rates are usually lower.
However, an open bridging loan doesn’t have a guaranteed exit date; a borrower can only indicate to the lender how long the loan will be required.
A bridging loan exit strategy is your planned repayment method, for example your bridging loan exit strategy may be the sale of a property
As soon as you think you will be unable to clear the bridging loan on time, speak to your lender asap; they may be able to work out a different solution in terms of repayment. Alternatively, you may need to consider taking out a new bridging loan to clear the old one and give you more time to pay. And don’t be afraid to seek help; you can get free debt advice from the Citizens Advice Bureau.
Terms typically last from 1 month to 18 months, with a minimum loan term of 30 days.
View our Bridging Loans guide for more information
Providing the bridging loan you choose doesn’t require monthly repayments, your borrowing history won’t be assessed in the same way as if you take out a mortgage or a secured loan. So as long as your property is suitable security for the loan and you have a exit strategy, you should be able to get a bridging loan even if you have a bad credit score.
Yes. Getting a mortgage on an auction property is possible but If there’s a delay getting your mortgage, you can use a bridging loan to purchase a property at auction. One benefit is they can be arranged quickly. You can also use bridging loans to buy unmortgageable properties.
HomeOwners Alliance Ltd is registered in England, company number 07861605. Information provided on HomeOwners Alliance is not intended as a recommendation or financial advice. Bridging loan estimated cost figures provided by Chartwell Funding Limited. Bridging Loan and specialist lending service provided by Chartwell Funding Limited, registered office 5 Badminton Court, Station Road, Yate, Bristol, BS37 5HZ, authorised and regulated by the Financial Conduct Authority (FRN: 458223). Your property may be repossessed if you do not keep up repayments on a mortgage or any debt secured on it.
