Bridging Loans Lawyers
Expert bridging loan solicitors
Our expert bridging loan lawyers act exclusively for borrowers of short term loans, developmental loans and commercial loans. Contact Bridging Loan Lawyers today
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Years of experience
Why do I need a lawyer for a bridging loan?
If you are getting a bridging loan having a lawyer is essential for several reason:
Legal Due Diligence
The lender requires a solicitor to conduct legal checks on the property, ensuring there are no outstanding legal issues, charges, or restrictions that could affect the bridging loan.
Loan Agreement Review
A bridging loan involves complex legal terms, interest rates, and repayment obligations. A solicitor ensures that the borrower understands the contract and is not exposed to unfair terms.
Property Searches
Bridging loan solicitors carry out necessary property searches, such as local authority checks, to identify potential issues that might affect the lender’s security.
Mortgage and Charge Registration
If the loan is secured against a property, the bridging loan solicitor will need to register a legal charge with the Land Registry to protect the lender's interest.
Funds Transfer
The bridging loan solicitor manages the secure transfer of funds between the lender and borrower, ensuring compliance with anti-money laundering regulations.
Risk Management
Having a bridging loan lawyer helps protect both the borrower and lender from legal risks, preventing future disputes or unforeseen legal complications.
What is a bridging loan?
A bridging loan is a short-term financial solution designed to provide immediate funds while waiting for a long-term financing arrangement to be secured. Often used in property transactions, bridging loans allow buyers to move forward with a purchase without having to wait for their current property to sell or for mortgage approval.
These loans are particularly beneficial when time-sensitive opportunities arise, such as purchasing a property at auction, financing urgent renovations, or preventing delays in a property chain. Given their short-term nature, bridging loans usually come with higher interest rates, making it essential to have a clear repayment plan in place.
Do you need legal advice for your bridging loan?
How it works
Common bridging loan questions
How can a bridging loan be used?
Meeting Urgent Property Transaction Deadlines
If you need to secure funds quickly for a property purchase but face delays with conventional lenders, a bridging loan can provide a short-term solution.
Purchasing Property Before Selling Another
When a property chain breaks or a buyer withdraws, a bridging loan can offer financial security, allowing you to complete the purchase without waiting for the sale of your existing property.
Buying Auction Properties
Auction properties require quick completion, often within 28 days. A bridging loan ensures you can complete your purchase on time while arranging long-term financing.
Funding Property Refurbishment
If your property needs renovations before being sold or refinanced, a bridging loan provides the capital needed for refurbishment, with repayment made upon sale or refinancing.
Expanding Property Portfolios
Landlords and property investors can use bridging loans for rapid acquisitions, avoiding the lengthy approval times associated with traditional buy-to-let mortgages.
Do you qualify for a bridging loan?
Eligibility for a bridging loan depends on several factors, including:
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Loan Size and Term – Loan amounts vary, usually capped at 75% loan-to-value (LTV), with terms ranging from a few weeks to two years.
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Purpose of the Loan – Lenders assess whether the loan is for an acceptable purpose, such as property purchase or refurbishment.
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Security Provided – Most bridging loans require property as collateral, ensuring the lender has security in case of non-repayment.
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Exit Strategy – A clear repayment plan is crucial, whether through property sale, refinancing, or other financial arrangements.
How much can you borrow?
Bridging loans range from £20,000 to several million pounds, depending on your financial needs and the value of your collateral.
How quickly can a bridging loan be arranged?
Unlike conventional mortgages, bridging loans can be approved within days, making them a practical option for urgent financial needs. Our expert bridging loan solicitors help expedite the legal process, ensuring a smooth transaction.
How is interest on a bridging loan paid?
There are three main ways to pay interest:
- Monthly repayments: The borrower pays the interest each month.
- Rolled-up interest: Interest is added to the loan and paid at the end of the term.
- Retained interest: The interest is deducted upfront from the loan amount.
Do I need to own a property to get a bridging loan?
Yes, bridging loans are secured loans, meaning they require property or land as collateral.
Is a deposit required for a bridging loan?
Most lenders require a deposit, typically 25-35% of the property value, meaning they lend up to 65-75% loan-to-value (LTV).
Can I pay off a bridging loan early?
Yes, many bridging loans allow early repayment, though some may have exit fees.
What’s the difference between a bridging loan and a mortgage?
- Bridging loans: Short-term (up to 12-24 months), higher interest rates, used for quick transactions.
- Mortgages: Long-term (10-30 years), lower interest rates, used for property purchases with planned repayments.
Open vs. Closed Bridging Loans
Closed Bridging Loans
Have a fixed repayment date, commonly used when a guaranteed repayment source (e.g., a property sale) is in place.
Open Bridging Loans
Offer flexibility on the repayment date, often used when awaiting a sale or securing long-term financing.
Costs involved in bridging loans
Common fees include:
- Arrangement fees (1-2% of the loan amount)
- Valuation fees (for property assessment)
- Legal fees (covering loan agreements)
- Exit fees (some lenders charge a fee for early repayment)
Why you need bridging loan solicitors
Instructing experienced bridging loan lawyers ensures a seamless and legally compliant process. Our solicitors assist with:
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Conducting legal due diligence
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Drafting and reviewing loan agreements
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Registering property charges
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Managing secure fund transfers
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Ensuring compliance with lender requirements
What is an exit strategy for a bridging loan?
An exit strategy is how the borrower plans to repay the loan, such as:
- Selling the property
- Refinancing with a mortgage
- Using business funds or other financial arrangements
Can I get a bridging loan with bad credit?
Yes, some lenders offer bridging loans to individuals with bad credit, but they may charge higher interest rates and require additional security.
Can I use a bridging loan to buy a property at auction?
Yes, bridging loans are commonly used for auction purchases, where buyers need to complete transactions quickly (usually within 28 days).
What happens if I can't repay a bridging loan?
If you fail to repay, the lender may take legal action, including repossessing the secured property. It’s essential to have a clear exit strategy before taking out a bridging loan.
Are bridging loans regulated by the FCA?
Only regulated bridging loans (for residential use) are covered by Financial Conduct Authority (FCA) regulations. Unregulated loans (for commercial or investment purposes) are not.
How do I apply for a bridging loan?
You can apply through specialist lenders, banks, or brokers. The process typically involves:
- Submitting an application with financial details
- Property valuation
- Approval based on exit strategy and risk assessment
- Signing agreements and receiving funds
Customer Feeback
“Bridging Loan Lawyers made the entire process seamless and stress-free. Their expertise in handling complex property transactions gave me confidence in every step. Highly professional, efficient, and responsive—couldn’t have asked for better service!”
Emily Turner
"I was in urgent need of legal assistance for a bridging loan, and Bridging Loan Lawyers exceeded my expectations. Their knowledge of the legal intricacies helped me secure the best terms, and their communication was outstanding. I highly recommend them!"
James Patterson
"Fantastic service from start to finish! The team at Bridging Loan Lawyers guided me through every detail, ensuring my transaction was legally sound and completed on time. Their attention to detail and professionalism were second to none!"
S Whitmore
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