Bridging Loan Calculator – Rates From 0.55% per Month

Updated
Oct 1, 2025 5:44 PM
Written by Nathan Cafearo
Explore how bridging loan calculators work, what rates you can expect, and what to consider before applying. Make informed decisions about short-term property finance with Kandoo's expert guidance.

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Understanding Bridging Loans and Online Calculators

Bridging loans offer an accessible route to short-term finance, often used for property purchases or investment when timing is critical. With rates starting from 0.55% per month, a bridging loan calculator can help estimate your monthly payments and total costs quickly. But beyond the numbers, it’s essential to understand how these loans work, what influences the rates, and the risks involved.

Who Should Use a Bridging Loan Calculator?

This guide is for UK consumers considering a bridging loan—particularly property buyers, developers, or landlords facing tight completion deadlines or renovation projects. If you need fast, flexible funding to bridge the gap between transactions, understanding costs upfront with a calculator is crucial.

Key Concepts: The Basics of Bridging Finance

A bridging loan is a short-term secured loan, typically lasting from a few months up to two years. Its primary purpose is to ‘bridge’ a funding gap, such as buying a new home before selling your existing one, or financing property refurbishment prior to arranging a long-term mortgage.

Core terminology:

  • Loan-to-Value (LTV): The percentage of your property’s value you can borrow against, typically up to 75%.

  • Monthly Interest Rate: Rates can start as low as 0.55% per month, but vary based on risk, property type, and lender.

  • Gross vs Net Loan: Gross includes interest and fees deducted upfront; net is the amount you actually receive.

  • Exit Strategy: How you’ll repay the loan (e.g., sale of property, refinancing).

Bridging loans are usually interest-only, with the capital repaid in a lump sum at the end of the term. Some lenders roll up the interest, meaning you pay nothing until redemption.

Your Bridging Loan Options

When considering bridging finance, your options fall into several categories:

  • Open bridging loans: No fixed repayment date, suitable if your exit strategy isn’t certain.

  • Closed bridging loans: Fixed repayment date, often when contracts have already been exchanged.

  • First or second charge: First charge loans take priority over other mortgages; second charge loans sit behind an existing mortgage.

  • Regulated vs unregulated: Regulated loans apply when the property is your residence; unregulated loans are for investment or commercial purposes.

A bridging loan calculator allows you to input your required loan amount, property value, estimated term, and see indicative monthly interest and total costs. However, actual rates will depend on the lender’s assessment, property details, and your financial profile.

Type Typical Use Rate Range (pm)
Open Bridging Loan Property chains, delays 0.55% – 1.5%
Closed Bridging Loan Set completion date 0.55% – 1.2%
Regulated Bridging Residential use 0.55% – 1.0%
Unregulated Bridging Buy-to-let, commercial 0.65% – 2.0%

Costs, Impact, and Risks

While rates from 0.55% per month can appear attractive, it’s vital to factor in additional costs:

  • Arrangement fees (1–2% of the loan amount)

  • Valuation and legal fees

  • Broker fees (where applicable)

  • Exit fees (sometimes charged at redemption)

Interest is often calculated monthly, not annually, so the stated rate should be multiplied by the number of months to understand the real cost. For example, a 0.55% monthly rate equates to 6.6% per year, excluding fees. Failure to repay on time can result in penalties, or even repossession of the property.

Eligibility and Requirements

Lenders will consider:

  • Property type and value

  • Your credit history

  • Exit strategy clarity

  • Borrowing amount and LTV

  • Location and property condition

Most require applicants to be over 18, UK residents, and to provide evidence of income or a robust exit plan. The stronger your financial profile and security, the better your rate is likely to be.

Step-by-Step: How to Use a Bridging Loan Calculator

  1. Enter the property value

  2. Input desired loan amount

  3. Select loan term (in months)

  4. Choose property type (residential/commercial)

  5. Indicate if first or second charge

  6. Input estimated monthly interest rate

  7. Add any arrangement or exit fees

  8. Review the projected total repayment

Pros and Cons: What to Consider

Pros:

  • Quick access to funds (often within days)

  • Flexible lending criteria

  • Useful for property chains or auction purchases

Cons:

  • Higher interest rates than standard mortgages

  • Significant fees can add up

  • Short-term only; not suitable for long-term borrowing

It’s vital to weigh the speed and convenience against the cost and risk of default.

Before You Decide: Key Points to Watch

Always scrutinise the terms, especially around:

  • Penalties for late repayment

  • How interest is charged (monthly or rolled up)

  • All associated fees

  • The firmness and feasibility of your exit strategy

Seek independent advice and compare offers from several lenders. A bridging loan is a powerful tool, but only if used knowledgeably.

Other Options: Alternatives to Bridging Loans

If a bridging loan isn’t right for you, consider:

  • Remortgaging: Access equity from your property at lower rates

  • Secured loans: Longer terms and potentially lower costs

  • Personal loans: For smaller, unsecured amounts

  • Family loans or private investors: Can sometimes offer more flexibility

Compare the total costs, speed, and eligibility criteria before proceeding.

FAQs

1. How accurate are online bridging loan calculators?
They provide estimates based on typical rates and fees but actual offers will depend on lender assessment.

2. Can I get a bridging loan with bad credit?
It’s possible, especially if you have strong security and a clear exit strategy, though rates may be higher.

3. How quickly can I access funds?
Some bridging loans complete in as little as 3–7 days, depending on complexity.

4. Are bridging loans only for property purchases?
No, they can also fund renovations, business needs, or resolve cash flow issues.

5. Do I need a deposit for a bridging loan?
Usually, yes—most lenders allow up to 75% LTV, so you’ll need equity or a deposit.

6. Will using a broker help?
Brokers can access specialist lenders and may secure better terms, though fees apply.

Next Steps

If you’re considering a bridging loan, use a reputable online calculator to estimate your costs. Gather your property and financial details, clarify your exit strategy, and compare offers from multiple lenders or consult a broker like Kandoo for tailored support.

Disclaimer

This article is for informational purposes only and does not constitute financial advice. Bridging loans are complex financial products—seek professional guidance before committing. Rates and eligibility are subject to change and depend on individual circumstances.

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