Bridging loans · England & Wales
Bridging loans, built around your exit
Fast, flexible short-term property finance for professionals, from £75k to £10m, secured against residential, semi-commercial and commercial property. Honest terms, a credible exit, and a decision-maker on the other end of the phone.
The basics
What is a bridging loan?
A bridging loan is a short-term loan secured against property. It exists to bridge a gap in time; between buying and selling, between a purchase and a refinance, or between a property’s current condition and the value it will reach once work is done. Because it is secured by a legal charge over real estate, a bridging loan can be arranged in days rather than the weeks or months a term mortgage takes, which is why property professionals reach for it when speed decides the deal.
Bridging finance is short-term by design. Terms typically run from a few months up to 24 months, and the loan is repaid in full at the end from a defined source: your exit. That makes it a tool for situations with a clear beginning and end, not a substitute for a long-term mortgage. At Proxima Capital we lend from £75k to £10m across England and Wales, assessed on the merits of each case.
Mechanics
How do bridging loans work?
A lender takes a charge over one or more properties as security, agrees a loan amount based on the property’s value and your exit, and releases funds. Interest is charged monthly and the principal is redeemed at the end of the term. Because the security and the exit carry the risk, a bridging lender cares less about historic income and more about the asset, the plan and how you will repay.
Uses
What can you use a bridging loan for?
Almost any situation where property-backed funding is needed quickly and repaid from a clear source. Common cases we fund:
- → Breaking a property chain when a sale slips
- → Buying at auction inside the 28-day deadline
- → Light or heavy refurbishment before sale or let
- → Conversion and small development
- → Capital raising against existing equity
- → Commercial and semi-commercial purchases
- → Buy-to-let, HMO and MUFB acquisitions before refinance
- → Time-critical purchases that won’t wait for a mortgage
Types
Types of bridging loan
Bridging is described along a few simple axes. Most loans are a combination of them.
Open vs closed bridging loans
A closed bridging loan has a fixed exit date – typically an exchanged sale with a known completion. An open bridging loan has a credible exit but no fixed date yet. Closed bridges carry less risk and often price keener; open bridges need a well-evidenced plan. Proxima Capital only offer closed bridging loans.
First vs second charge
A first charge sits first in line against the property. A second charge sits behind an existing mortgage, letting you raise funds without disturbing a low-rate first loan. Second charges need the first lender’s consent and price for the extra risk of ranking behind the first charge.
Regulated vs unregulated
A regulated bridging loan is one secured against a property you or an immediate family member live in, or intend to – these fall under Financial Conduct Authority (FCA) rules. An unregulated bridging loan is secured against investment or commercial property and sits outside FCA consumer regulation. The distinction is set by the property’s use, not by the lender.
By property type
We bridge against residential, semi-commercial and commercial property, including land with the right planning position. Each asset class has its own valuation and LTV considerations, which we work through with you up front.
Every deal gets an honest answer the same day. We price the risk on the asset and the exit, not a tick-box and we only lend when the exit genuinely stacks up. That is how a fast decision becomes a clean completion.
Tom Athersych · Managing Director, Proxima Capital
Borrowing
How much can you borrow?
The amount is driven by the property’s value and your loan to value (LTV). Proxima lends from £75k to £10m, up to 75% LTV against residential security, with lower limits on commercial and land where the market moves the risk. On refurbishment and development cases, lending can be structured against the gross development value (GDV) – the property’s worth once works complete – within sensible loan-to-GDV limits.
It helps to know two terms. The gross loan is the full facility, including interest and fees. The net loan is what reaches you on day one. Our bridging loan calculator shows both, so there are no surprises about your net advance.
Cost
What does a bridging loan cost?
Bridging interest is charged monthly, not annually, with Proxima rates from 0.85% per month. Your rate depends on the asset, the LTV, the charge position and the strength of your exit. On top of interest you should budget for an arrangement fee (usually 2% of the loan), a valuation, and legal costs. Full detail sits on our bridging loan rates and costs page.
How the interest is paid is your choice of three models:
Retained
The lender deducts the full term’s interest from the advance upfront. You make no monthly payments and redeem the gross loan at the end.
Rolled up
Interest is added to the balance each month and repaid in full at redemption. The balance climbs across the term.
Serviced
You pay the interest monthly and redeem the principal at the end, so the balance stays flat throughout.
The thing that matters
Why your exit strategy matters most
A bridging loan is only as good as the plan to repay it. Your exit is usually one of two things: the sale of the security or another asset, or a refinance onto a term mortgage, buy-to-let or development facility. A credible, evidenced exit is what turns a fast decision into a clean completion – and what protects you from a costly default at the end of the term.
We structure every case around the exit first. If the exit doesn’t stack up, we’ll tell you early rather than late – because a loan that can’t be repaid helps no one.
Bridging with Proxima
A lender that can actually complete
Proxima was founded by highly experienced operators who have overseen in excess of £500m of property lending, so you deal directly with the decision-makers. You will get a prompt decision in principle within 24 hours, with best-in-class solicitors and market-leading title indemnity keeping completion fast and certain.
Choosing
How to choose a bridging lender
The market is full of bridging loan lenders and bridging loan brokers, and the headline rate is rarely the whole story. The best bridging loan is the one that actually completes – on the terms quoted, in the time you have. When you compare lenders, look past the monthly interest rate to the arrangement fee, the exit fee (if any), the valuation approach, and whether you are dealing with a broker or directly with the lender who makes the decision.
Proxima Capital lends directly across England and Wales, so the person who issues your decision in principle is the person who structures the loan. No layers, no broker chain, no terms that drift between quote and completion. Compare our bridging loan rates and how we sit against other lenders and brokers before you commit.
FAQs
Bridging loan questions, answered
Are bridging loans a good idea?
For the right purpose, yes. Bridging is well-suited to short-term, time-critical situations with a clear exit – an auction purchase, a chain break, a refurbishment before sale. It is more expensive than a term mortgage, so it is the wrong tool for long-term borrowing. Used with a credible exit and a sensible term, it does a job nothing else can.
What are the disadvantages of a bridging loan?
Interest is charged monthly and adds up quickly, fees and valuation costs apply, and the loan is secured against property – so your property may be at risk if the exit fails and you cannot repay. The main risk is a weak or delayed exit, which is why we stress-test the exit before we lend.
How much deposit do I need for a bridging loan?
Bridging is sized by loan to value rather than a cash deposit. With lending up to 75% LTV, you would typically need at least 25% equity in the security – either as cash into a purchase or as existing equity in a property you already own. Lower-risk cases and additional security can change that.
How fast can a bridging loan complete?
We issue a decision in principle within 24 hours and structure cases to complete in days where the valuation and legals allow. See fast bridging loans for how we compress the timeline.
Can you get a bridging loan with bad credit?
Often, yes. Because a bridging loan is secured against property and repaid from an exit, we weigh the asset and the plan more heavily than your credit score. Bad credit need not rule out a bridging loan, though adverse credit can affect the interest rates and the loan to value on offer. We assess each case on its merits rather than against a tick-box credit policy.
What are the alternatives to a bridging loan?
Depending on the timeline and exit, alternatives to a bridging loan include a term mortgage or buy-to-let mortgage, a second-charge mortgage, development finance for larger schemes, or asset finance. The advantage of bridging is speed and flexibility; the alternatives are usually cheaper but slower. If a different product is the better fit, we will say so.
Have a deal in mind?
Tell us about it and you’ll get an honest, commercial view the same day, direct from decision makers.
