Bridging finance for stalled developments

Momentum, regained: why stalled projects are turning to bridging

If your site has slowed to a crawl or stopped entirely, you are not alone. Developers across Great Britain have faced tighter credit conditions, contractor delays, and cost overruns. Yet the market is showing real resilience. In Q1 2025, UK bridging completions held at roughly £2.8 billion, matching late 2024 highs despite the seasonal lull. New applications surged more than half again, with average loan sizes steady around mid-six figures. That stability signals a market solving real problems in real time.

Understanding APR is not just about percentages - it is about knowing what you will pay in pounds and days saved. Bridging is designed for speed, not permanence. It lets you buy time, fix gaps, and capture opportunities that slow mortgages miss. Rates have edged lower this year alongside the Bank of England’s cuts, with competitive pricing around sub-1% per month for the strongest cases. For viable schemes that just need liquidity to get moving, that cost can be the difference between write-off and completion.

The trend is not niche. More than a third of UK developers report using bridging in 2025, even as one in three pause or scale back projects. Brokers say development bridging is topping search activity, driven by land acquisitions, cost overruns, phased builds, and the scramble to protect chains. Crucially, bridging works mid-project. Where new orders fell sharply through late 2024, short-term funding has stepped in to turn stalled sites into completed, revenue-producing assets.

Kandoo is a UK-based retail finance broker. We connect you with a wide panel of specialist lenders, helping you compare terms quickly and choose a route that fits your timeline, exit plan, and risk tolerance. With property markets shifting and timelines tight, clarity is worth as much as capital. Our role is to bring both to the table.

Who benefits right now

Bridging suits UK developers, landlords, and homeowners who need short-term capital to move decisively. If you are facing a funding gap between construction phases, a refinance delay, a chain break, or a time-sensitive auction, bridging can provide the liquidity to keep the programme on track. It is also increasingly used by smaller developers and homeowners under regulated frameworks where protection matters.

If you are mid-build with a clear exit - for instance, a refinance to a development exit loan or buy-to-let mortgage once works reach practical completion - bridging can cover cost overruns, materials, and labour to finish. For investors, lower base rates have improved affordability, making short-term finance more attractive for refurbs, conversions, and purchases that cannot wait for traditional underwriting.

Your funding paths

1. Development bridging loan - short-term funding to complete works, cover overruns, or acquire land pre-planning.

2. Refurbishment bridge - tailored for light to heavy refurbs, often with staged drawdowns.

3. Regulated bridge - secured on a residential property you or a family member occupy, with consumer protections.

4. Auction bridge - fast funding to complete within 28 days, then refinance.

5. Chain-break bridge - prevent a sale from collapsing while you arrange long-term finance.

6. Bridge-to-let or bridge-to-sell - finish works and transition to a term mortgage or sale.

Costs, impact, returns, and risks at a glance

Can you qualify

Eligibility is pragmatic and focused on deliverability. Lenders look for a credible scheme, experienced or well-advised borrowers, and strong security. Expect scrutiny of planning status, build progress, professional reports, and the exit strategy. If you are bridging mid-project, provide the current programme, scope of works, QS costings, and evidence of demand or pre-lets where relevant. Credit profile matters, but bridging can accommodate imperfections if the security and exit are sound.

For regulated bridges secured on a home you live in, consumer protections apply and affordability assessments are stricter. For unregulated development bridging, lenders weigh loan-to-value, loan-to-GDV, and your track record heavily. Kandoo can help strengthen your case by packaging the application with the right valuations, build budgets, and exit narrative. The stronger your documentation, the sharper the pricing and the quicker the drawdown. In a competitive 2025 market, readiness is a decisive advantage.

From enquiry to drawdown

1. Outline project, timeline, and required facility size.

2. Share documents: valuations, costings, planning, exit plan.

3. Receive options, compare pricing, terms, covenants.

4. Select lender and agree heads of terms.

5. Valuation, legal due diligence, and QS review.

6. Finalise structure, fees, and conditions precedent.

7. Sign, fund, and commence or resume works.

8. Monitor build and prepare refinance or sale exit.

Advantages and trade-offs

Before you commit

Bridging should solve a specific problem, not create a new one. Build your plan around the exit you control most securely, whether that is staged unit sales or a pre-agreed refinance once the asset is stabilised. Prices and rents can move. Allow for conservative GDVs, longer sales periods, and a clear path to income. Keep contingencies for materials, labour, and professional fees, and prioritise contractors who can deliver to programme. Where possible, run dual-track exits so one delay does not stall the entire scheme. Finally, read covenants closely. Pre-sales, build milestones, or information undertakings can be manageable if anticipated, but disruptive if missed.

Alternative routes to consider

1. Development finance with staged drawdowns and potentially lower pricing.

2. Mezzanine finance to top up equity behind senior debt.

3. Joint venture equity to de-risk leverage and share upside.

4. Asset refinance or term loan once income is proven.

5. Vendor financing or deferred consideration on site acquisitions.

6. Government or local authority schemes for regeneration and housing.

Frequently asked questions

Q: How fast can I complete a bridge for a stalled build? A: With documents ready, some lenders complete within one to two weeks. Complex cases may take longer due to valuations and QS reviews.

Q: What loan size can I expect? A: Average market loans are mid-six figures, though facilities range from sub-£100k to multi-million. The security value, leverage, and scheme viability drive limits.

Q: Are rates improving in 2025? A: Market pricing has eased alongside Bank of England cuts, with competitive cases around sub-1% per month. Your exact rate depends on risk, leverage, and experience.

Q: Can bridging fund mid-project cost overruns? A: Yes. It is frequently used to restart builds, cover materials and labour, and carry schemes to completion before refinancing or sale.

Q: What if my refinance is delayed? A: Build in time buffers. Some lenders allow extensions for a fee. Keeping multiple exit options and early engagement with term lenders reduces pressure.

Q: Is a regulated bridge right for me? A: If the security is your residence or a close family member’s, regulated bridging may apply, offering consumer protections with affordability checks.

Q: Will poor credit stop me? A: Not necessarily. Strong security and a credible exit can offset historic issues. Transparent disclosure helps shape a workable structure.

How Kandoo helps you move first

Kandoo is a UK-based retail finance broker. We compare specialist bridging lenders quickly, line up realistic terms, and package your case for faster decisions. You get clear costings, a plan for drawdown, and a credible exit mapped from day one. Speak to us and restart with confidence.

Important information

This article is for information only and does not constitute financial advice. Bridging finance is secured against property and may be repossessed if you do not keep up repayments. Seek independent advice to assess suitability for your circumstances.