Bridging finance for asset purchases

Why speed matters in today’s UK property market

Bridging finance can be the difference between winning and missing out on a time-sensitive deal. In the UK, loan books topped £10.3bn in 2024 and are forecast to reach £12.2bn by the end of 2025. That growth is not accidental. Buyers are using short-term funding to act quickly where traditional mortgages cannot move at the same pace.

Timelines have tightened. Q1 2025 saw the fastest-ever average completion at 32 days, while broader H1 data showed typical completions in around 43 days from offer. That speed suits auctions, chain breaks, and investment purchases where sellers prioritise certainty. It is not just velocity either. Competition between lenders has pushed average monthly rates down to around 0.81% in Q2 2025, with some data points showing quotes from 0.64% in specific scenarios. Lower borrowing costs help make the numbers stack on flips, refurbishments, and buy-before-sale moves.

Crucially, the market is broadening. Investment purchases climbed to 23% of use in early 2025. Regulated bridging for residential needs is also in play, with a significant share of loans supporting homeowners navigating tight timelines. Typical loan-to-values sit near the mid-50s, with maximum LTVs up to 75% on selected cases. Common exits are straightforward: sale or refinance, including bridge-to-let routes when rental yields support a longer-term mortgage.

Stability matters. Despite wider economic uncertainty, quarterly lending has remained steady to rising, with volumes up again into Q3 2025. Brokers and borrowers report confidence from shorter processing times and sharper pricing. For buyers, that translates into one key advantage: the ability to transact on good assets when others hesitate.

Bridging is about turning a good opportunity into a secured purchase before the window closes.

Short-term finance is not a one-size solution. You should weigh fees, interest, and exit strategy before proceeding. But when timing is critical, bridging can be a precise tool that supports decisive, informed action.

Is bridging right for you?

If you need finance quickly to secure an asset, bridging may fit. It is commonly used by landlords, developers, and buyers managing chain breaks, but it is increasingly useful for homeowners who need to buy before selling. Investors use it to acquire properties that require light to heavy refurbishment, including HMOs and conversions, where a standard mortgage is not immediately available.

Bridging works best when you have a clear exit plan. That might be selling the property post-completion, refinancing to a buy-to-let or residential mortgage once works are finished, or releasing equity from another asset. If your deal relies on timing, improved value, or a future remortgage, bridging can create the breathing space to move first and tidy the details later.

Ways to use bridging today

1. Buy before you sell to avoid chain break and secure your next home.

2. Purchase at auction with 28-day deadlines and limited mortgage readiness.

3. Investment purchases where speed secures a discount or beats competitors.

4. Refurbishments and conversions that need works before a mortgage fits.

5. Bridge-to-let strategies to refinance onto a buy-to-let post-works or letting.

6. Regulated refinance to clear short-term obligations under time pressure.

7. Commercial acquisitions where valuation or tenancy complexity delays term debt.

Quick comparison of common uses

Speed, not just price, often decides who gets the keys.

The numbers that matter

Who can qualify and on what basis

Eligibility depends on property type, your credit profile, and the viability of your exit. Lenders assess whether the asset is mortgageable today or will be after works. Residential, buy-to-let, and mixed-use assets are common, with commercial considered on a case-by-case basis. Regulated bridging is available when the property is or will be your home, sitting under UK consumer protections. Unregulated bridging applies to investment and business purposes.

Most lenders look for clear documentation: ID, proof of funds for deposit and fees, evidence of income or rental cover where relevant, and a realistic timeline to exit. Valuation, legal due diligence, and title checks must stack up. Where refurbishment is planned, a works schedule and costings help support the case. Credit issues are not always a barrier if there is sufficient equity and a credible repayment route.

Kandoo can review your objectives and match you with lenders that fit your timeframe, LTV, and credit profile. Expect leverage typically in the mid-50s LTV, rising toward 70-75% for stronger propositions. If your exit is a sale, agents’ comparables and a conservative pricing view help. If your exit is refinance, we will sense-check rental stress tests and affordability against current lender criteria.

From application to drawdown - step by step

1. Share your timeline, exit strategy, and funding gap clearly.

2. Kandoo sources lenders aligned to asset type and LTV.

3. Receive terms, including rates, fees, and conditions.

4. Instruct valuation and appoint experienced solicitors promptly.

5. Provide documents and respond to enquiries quickly.

6. Review offer, satisfy conditions, and sign legal paperwork.

7. Funds draw down to meet completion date.

8. Track exit milestones and prepare refinance or sale.

Cost, impact, returns, risks

Weighing up the trade-offs

Read this before you proceed

Bridging should begin with your exit. If you plan to sell, allow for conservative pricing and longer marketing periods. If you plan to refinance, check rental cover and affordability using current lender stress tests, not last year’s. Timeline discipline is critical. Even with faster processing averages near 32-43 days, complex legals or down-valuations can add weeks. Build contingency for costs and time.

Market conditions are favourable, with quarterly lending steady to rising and rates around multi-quarter lows. That said, the UK Budget and regulatory changes can influence pricing, fees, and appetite. Keep a close eye on announcements and consider locking terms when appropriate. Choose experienced solicitors and valuers who know bridging. Small efficiencies here prevent major delays later.

Next steps you can take today

• Gather ID, proof of funds, and exit evidence.

• Outline a realistic timeline from offer to exit.

• Speak to Kandoo to benchmark rates and terms.

Alternatives if bridging is not the fit

1. Auction finance from specialist lenders tailored to gavel timelines.

2. Refurbishment mortgages for lighter works where term debt is feasible.

3. Development finance for ground-up or heavy conversion projects.

4. Secured loans or second charges against existing equity.

5. Business loans or asset finance where property is not central.

6. Vendor financing or delayed completion agreements with the seller.

Straight answers to common questions

Q: How long does bridging take from application? A: Many cases complete in 32-43 days, though complex titles or commercial elements may extend timelines. Instruct valuation and legals early to keep pace.

Q: What interest rate should I budget for? A: Recent averages sit around 0.81% per month, with some scenarios quoted lower. Pricing depends on LTV, asset type, and your exit strength.

Q: How much can I borrow against the property? A: Typical LTVs are around the low to mid-50s, with selected cases up to 75%. Lower LTVs usually attract keener rates and faster credit decisions.

Q: What are the most common exit strategies? A: Property sale accounts for the majority of exits, followed by bridge-to-let. If refinancing, ensure rental and affordability tests are achievable.

Q: Is regulated bridging available for my home purchase? A: Yes. Regulated bridging is used for residential purposes under UK consumer rules. Expect thorough checks and clear disclosure of costs and risks.

Q: Are fees paid upfront or added to the loan? A: Arrangement fees can be deducted from the advance or paid separately. Interest may be retained, rolled up, or serviced monthly depending on the lender.

Q: What happens if my exit is delayed? A: Speak to your broker early. Extensions may be possible, but plan contingencies to avoid forced sales or penalty costs.

What Kandoo brings to your application

Kandoo is a UK-based retail finance broker. We assess your timeline, exit plan, and property details, then match you with lenders offering competitive rates and practical terms. Our panel covers regulated and unregulated bridging, auction finance, refurb strategies, and bridge-to-let. We coordinate valuation and legal steps to keep your purchase on track, so you can move quickly and confidently.

Important information

Bridging loans are secured against property and may not be suitable for everyone. Your home or investment property could be at risk if you do not keep up repayments. Terms, rates, and eligibility depend on your circumstances and lender criteria. Kandoo is a broker, not a lender, and may receive a commission from lenders.