Bridging Loan Calculator

The bridging finance calculator is used for evaluating the required bridging loan amount .

SINCE 2004

The bridging finance calculator is used for evaluating the required bridging loan amount where the security property asset is a:

  • Residential property – NOT regulated by the Financial Conduct Authority (FCA), e.g. Buy to Let, HMO. 
  • Permitted development scheme – for which planning consent has already been granted for conversion of the asset being used to secure property funding.

Commercial bridging loans: Please contact Loan X for your bridging finance quote.

Full Term Interest versus Redemption Amount

The bridging loan calculator is designed to provide an assessment guide to the overall cost of a bridging loan arrangement if it runs to full term.

The interest charged will be less if the loan is redeemed before full term.

Loan amount interest will then be recalculated against the redemption amount based on the revised length of time of the bridging loan arrangement.

While the loan calculator figures generated are an accurate appraisal, it is important to note they are intended as general guidance only.

Please contact Loan X at any time and we will be pleased to provide you with a detailed, accurate bridging loan quote, and approval.

Loan To Value (LTV) is a financial term used by lenders to express the ratio of a loan to the value of an asset purchase. Loan to Value is central to deciding the loan amount interest rate charged to the borrower.

The bridging loan to value (LTV) and monthly interest rate will be dependent on:


  • Property asset value
  • Type of security property asset
  • Property asset location
  • Credit profile of the borrower
  • <span”>Client experience, knowledge and aptitude

Additional Bridging Loan Fees and Costs

Bridging loan costs mainly comprise interest charges and arrangement fees added to the loan.

All bridging loan applications include a number of professional fees, which need to be fully understood and budgeted for at the outset.

It’s important to be aware that fees are not fixed, and the lender will provide a quote at the appropriate time.

The total borrowing cost of bridging finance should always be factored in rather than only considering the arrangement fee and interest rates.

Additional fees which WILL be added to the total bridging loan cost, are as follows:

Arrangement fee:  The typical lender’s fee is 2% of the bridging loan amount, deducted from the gross bridging loan amount on completion.

Admin fees: Additional fees of a varying amount charged by the lender, apart from one or two exceptions, are usually deducted from the gross loan amount.

Legal fees: Borrower will be liable for their own legal fees and those of the lender. In some cases, dual representation can be used, which helps reduce the fee amount. Legal fees are usually payable in advance under a formal legal undertaking.

Valuation fees: Most bridging loans require a valuation, except by a few specialist bridging loan lenders when lending against ‘good security properties’ and ‘good clients’ at quite low LTVs.

The valuation fee is usually payable in advance, with the amount charged dependent on:

  • Property asset value
  • Type of property asset
  • Location of property asset
  • Any work is to be carried out
Additional fees which MAY be added to the total bridging loan cost, subject to requirement or necessity, are as follows:

Quantity surveyor: Lending company may require a quantity surveyor report or a monitoring surveyor’s initial report to ensure the estimated build costs for property development or heavy refurbishment are accurate.

The fee will be determined by:

  • Market value of the property asset
  • Amount of work being carried out to the security property.

Supplementary professional reports:

A loan borrower may be liable for a specialist’s report and any quoted remedial works required if the valuer finds any areas of concern such as, Japanese Knotweed, asbestos, subsidence, damp or structural problems.

Exit fees: A loan borrower’s property and credit profile could be at serious risk if an issue arises with the chosen repayment method as the end of the loan arrangement approaches.

Inability to repay the loan at the end of the term will require refinancing or servicing of the loan, which may not be acceptable to the lender.

While the Exit fees are not always charged, they will still need to be accounted for by the loan borrower when calculating the redemption amount on settlement of the outstanding loan balance.

Additional fee NOT usually added by Loan X:

Broker fee: Charge not always applied for straightforward, residential bridging loans. However, when charged, it is typically 1%, which is also deducted from the gross loan amount on completion.<  

PLEASE NOTE: Loan X DO NOT usually charge an assessment fee.

Bridging Loan Approval

Qualifying for a bridging loan to quickly finance the purchase of a property asset is not reliant on standard criteria applied to regulated lending. Particularly, for the purposes of remortgaging.

All property asset types are usually accepted, and First and Second charge bridging loans* are available.

*First and Second Charge Bridging Loans

A ‘first charge’ is the primary mortgage or loan which takes precedence over all other finance secured against the property.

A ‘second charge’ loan could be secured against the property if there is sufficient equity.

Typical bridging finance criteria:

Bridging loans from £50,000 to £100 million+

Loan term from 1 month to 24 months

Bridging finance available throughout the UK and Western Europe

Loan Amount Eligibility

Qualification for bridging finance concentrates upon a property security asset or land ownership, and a realistic method of repaying the loan.

Poor credit history is usually not a barrier nor income necessarily an important factor.

Credit HistoryCCJs, defaults and arrears are considered, and usually accepted, provided the bridging loan exit is not dependent on refinancing.

No income proof required except when the loan is to be repaid through refinancing or if the loan borrower is planning to service the monthly interest.

Bridging loans are available to individuals, partnerships and limited companies.

Eligibility includes:


Individuals with Equity in their Property

Individuals, either employed or self employed

Individuals who cannot prove their income

Individuals with almost any credit status, good or bad

Individuals with Poor Credit   

Loan borrowers must be between 21 and 75 

UK and overseas residents welcome

UK Ltd Companies

UK Ltd Companies with Poor Credit

Limited Liability Partnerships (LLPs)


How Bridging Loan Interest is Calculated

The bridging loan calculator provides a detailed breakdown of:

  • Monthly interest rate charges
  • Arrangement fee/facility fee amount
  • Any broker fees or exit fee, if charged.

The net loan amount will be dependent on:

  • Bridging loan product
  • Monthly interest rate charged

Bridging Loan Additions and Deductions

Typically, the bridging loan interest plus arrangement fee will be deducted from the gross loan amount, to arrive at a net bridging loan figure

When a bridging loan is used to refurbish a residential property, a number of lenders will allow the monthly interest to be added to the net loan amount.

This can be useful if the required net loan amount needs to be increased. However, the facility fee and broker fee will still be deducted from the gross loan amount.

Calculating and Charging interest: Example

Bridging finance lenders have different ways of calculating and charging interest. In the majority of cases the interest is retained.
For example:

Property market value: £500,000
Bridging Loan LTV: 75%
Term: 12 months
Gross loan amount: £375,000
Interest charge: 0.75% per month
Interest amount: £2,812.5 per month
Total interest: £33,750
Facility fee @2%: £7,500
Day one net loan: £333,750

Settlement amount if loan kept for 6 months:
£333,750 + 6 months interest = £350,625

Types of Property Assets Used as Security for Bridging Finance

– available in both the UK and Western Europe.

Houses, flats, maisonettes, bungalows and HMOs

Commercial property, if being converted to one or more residential properties, e.g. an office with permitted development rights.

Multiple security properties

Properties ineligible for a mortgage

Refinancing of partially completed buildings, provided they are weatherproof

Difference Between a Mortgage and a Bridging Loan

A Bridging Loan is a short term funding option used for secured property lending, which enables the purchase or refinancing of a property asset when a mortgage is not available or the best option.

A mortgage arrangement is basically a long term loan which requires to be repaid in monthly instalments.

Bridging loan rates tend to be slightly higher than a mortgage but are often more cost-efficient in the long term, once early repayment charges (ERCs) are taken into account.

There are a number of Bridging Loan uses:

Expedite rapid refinancing of a property asset

Short term financing to apply for planning permission

When conventional credit is refused

Buying a property at auction needing to complete within 28 days

Obtaining an otherwise un-mortgageable property

Buying a property prior to the sale of an existing property

Buying an undervalued property from an LPA Receiver

Borrowing against value, not purchase price

Funding a property refurbishment project

Refurbishing a property to then sell on or refinance

Buying with a deferred consideration when net loan amount is insufficient

Purchasing an uninhabitable property or which requires refurbishment.

Buying a property with intention to change the title

Acquiring working capital or urgent financial liquidity

Loan borrowing without monthly payments or interest added to the loan

Do I Need to Get a Valuation?

RICS Red Book Valuations are required by most property finance lenders.

There are specific circumstances, in which some specialist lenders will not require a valuation:

  • When the underlying property asset is strong, and
  • LTV (loan to value) is low

Instead, the bridging loan provider will either rely on their internal asset manager or will use an AVM (Automated Valuation Model), otherwise known as a desktop valuation, using mathematical modelling combined with a database.