This short-term financing solution is designed to provide a cash injection to cover a temporary funding gap.
For residential borrowers, Bridging Loans are used to buy a property using existing home equity to fund the purchase of a new one before the old one is sold.
The gap between buying and selling is a bridge, and the bridging loan is the solution to fund it. For landlords and property developers, the bridging loan is used until longer-term finance is in place, such as arranging a buy-to-let mortgage on a property or funding the development.
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The types of bridging loans available
You can choose one of two types, depending on your circumstances. Those are open- or closed-end bridging loans, with the latter being the lower-risk option. That’s not to say it’s a risk-free way to borrow a quick stack of cash.
A closed bridging loan is only applicable when there’s a guarantee that a property or asset will be sold. Or there’s a certainty that funds will become available. If you’ve sold your home and are awaiting payment in full, perhaps while a buyer puts a mortgage in place and the sale of the contract is finalised, then a closed bridging loan would be available.
An open bridging loan is risky because there’s no telling whether your home will sell or how long it’ll take to sell. When you do not have any contracts in place to assure a lender that a sale is pending, and therefore you cannot assure a lender that you will have the money to repay within a fixed time-period, an open bridging loan would be an option to consider.
However, because this is a riskier type of loan due to the uncertainty of whether you will sell a property or other asset, lenders do not favour it. The majority of lenders, particularly high-street lenders, are hesitant to approve applications for open bridging loans.
Both Types of Bridging Loans are a Secured Loan
Both open and closed bridging loans will be secured. Usually, the security is the equity held in your home. For property investors, the LTV can be based on a property portfolio. Bridging loans typically require 75% LTV, though this can be extended to 100% with additional security.
Nationwide Bridging Loans Comparisons
Typical interest rates are from 0.65% to 1.2%. Those are typical rates, though, and will vary at both ends by lender. What also needs to be considered are the fees attached to the loan. In most cases, the fees are added to the bridging loan total, so there are no upfront costs.
LTV ratios also vary from one lender to the next. Some cater to 75% LTV, while others are willing to provide 100% LTV, provided there’s additional security available.
Speed is the main differentiating factor between providers. With a broker who has market knowledge, a Bridging Loan can be arranged in days. For property developers interested in buying at auction, an auction purchase typically requires a 10% initial deposit, with the remainder paid within 28 days. It’s often longer than that to arrange a B-T-L mortgage. Using a bridging loan will cover the property costs until refinancing is in place.
Repayment Considerations
Before applying for a bridging loan, it’s imperative to establish how you intend to repay the loan. The first question lenders will ask is about how you intend to repay.
There are two ways considered acceptable:
- The sale of the property
- Refinancing
For property sales, if the property isn’t on the market, lenders may require agreement on a specified date for the property to be listed. It’s worth considering how long it’ll take to complete any renovation work on a property, as this can help set a date for the property to be renovated and put on the market.
When your exit strategy is the sale of a property, borrowing is simple.
Using refinancing as an exit strategy can be trickier. Lenders will conduct due diligence on your financial history to determine the likelihood that you can refinance based on your creditworthiness, i.e., are you likely to get a mortgage?
That involves an income analysis to determine your likelihood of getting alternative finance, and if so, will the amount of finance you’re able to access at a later date be sufficient to cover the amount you need, plus the loan amount, any fees added to the loan, such as the arrangement fees, and the interest accrued.
The Length of Time to Repay
Due to the fluctuating nature of the property market, landlords and developers find it beneficial to agree on the longest possible term, such as 24 months, provided the lender does not have an early repayment charge (most don’t). In particular, when renovations are being carried out on a property, as things don’t always go to plan, a development plan falling behind can lead to loans overrunning the agreed terms.
For that reason, flexibility with a lender is imperative. The majority are simply because they know they need to be. Provided you keep your account in good standing, extended lines of credit can be agreed, bridging loans renewed, and, should cash flow become a problem during the course of a renovation, an existing lender will consider granting further finance based on your repayment history and the progress of the works.
Property Investment Bridging Loans
Bridging loans can be used for residential borrowing, but they are primarily aimed at property investors. With the right financial backing in place with a bridging loan provider, it enables investors to power forward on projects, knowing they have access to financing when they need it. That’s of great use in the auction room when buying properties cheaply, renovating to add market value, then refinancing or flipping them.
In essence, bridging loans are for high amounts of borrowing when it’s needed fast. They do have a higher rate of interest and because of that your exit strategy must be considered and will be asked by lenders as part of the application process.
How a Bridging Loan from Nationwide Can Help You…
Being first with a cash offer
A popular property attracts a lot of eyeballs. The longer the property sits on the market, the more interest it can pique, driving its price up.
For those with property portfolios, other properties can be used to secure a large bridging loan within a short timeframe. This is ideal if you find a property with potential, gain interest, and need to make an appealing offer; the seller will be hard to resist.
For residential borrowing, a bridging loan can help you be the first to put in an attractive offer on a property to upgrade your living arrangements. While others involved in the bidding process speak with mortgage advisors and deal with decisions-in-principle and other time-consuming tasks, a bridging loan can be arranged quickly, used to secure the property, and then repaid when your old property is sold.
When problems arise in the property chain…
Property transactions are not straightforward purchases when there’s more than one buyer and seller involved. That’s the majority of home purchases because in between, there’s the estate agent, the solicitors, the surveyors, and the mortgage provider. Any one of those companies involved can slow the process down. A good estate agent is essential to keep things moving along.
Which? surveyed 2000 home-movers in 2016 whose property purchases fell through. 28% stated property chain problems as the cause. 21% stated it was the sale of their own property, and 13% pulled out because the process was taking too long.
Property and mortgage chain issues are not a barrier to purchasing a property. A bridging loan can be used to secure a property, bridging the gap between buying a new property and selling the old one, even when the sale of your home falls through.
Tip: When you’re selling a property, ask around different estate agents about how they manage the sales process. You don’t want a company that just handles the process. Proactive estate agents have sales progression teams dedicated to keeping the process moving and keeping you informed along the way so you know what stage the sale is at. Ideally, use an estate agent with a sales progression division, as they’ll do more to keep your sale on track.
Self-Build Projects
Self-build finance is usually provided at 50% to 85% LTV of the land value. This is only the first stage in the process. Further financing is released at various stages of the building works, with re-inspection required before funding is released for the next stage of the build.
Any delays in the works’ progression will delay funding, as traditional lenders typically do not release funds until the end of each stage. That will delay the start of the next stage. A bridging loan may be needed to keep a project on track, at least until a stage is completed and the next round of finance is released by an existing lender.
About Us
Jubilee Finance works with an exclusive panel of lenders, including Bridging Loan Partners Nationwide, catering to residential and commercial borrowers, as well as specialist corporate short-term finance providers.
Whether you need to bridge the gap between buying a better property and selling your old home, buying low at auction, or need fast short-term finance for a large construction project, Jubilee is strategically positioned to access whole-of-market short-term finance solutions that can help bridge a gap in funding for whatever you need it for.
Comparing the Nationwide Building Society Bridging Finance Rates with Secured Loan Rates in 2026
For homeowners and property investors, finding the best financing option is crucial. In 2026, both bridging finance and secured loans offer viable solutions, but each comes with its own set of benefits and drawbacks. This guide explores and compares Nationwide Building Society’s bridging finance rates with secured loan rates, helping you make an informed decision.
Understanding Bridging Loans
Bridging loans are short-term financing solutions designed to cover the gap between the purchase of a new property and the sale of an existing one. These loans provide quick access to funds but typically come with higher interest rates and fees.
Benefits of Bridging Loans
- Quick Access to Funds: Bridging loans can be arranged quickly, often within a few days.
- Flexible Terms: These loans are designed to be short-term, usually lasting from a few weeks to a few months.
- Useful for Property Transactions: Ideal for property developers and investors needing immediate capital.
Nationwide Building Society Bridging Finance Rates
Nationwide Building Society offers competitive bridging finance rates, making it a popular choice among property investors. Below is a table comparing these rates with typical secured loan rates.
| Product | Interest Rate | Loan to Value (LTV) Ratio |
|---|---|---|
| Nationwide Bridging Loan | 5.5% | 75% |
| Secured Loan | 4.0% | 80% |
Secured Loans
Secured loans, also known as homeowner loans, are backed by an asset such as your home. These loans typically offer lower interest rates and longer repayment terms compared to bridging loans, making them a viable option for debt consolidation and other financial needs.
Personal Loan 25k
For significant financial needs, a personal loan 25000 can provide the necessary funds to cover substantial expenses or consolidate multiple debts.
Foundation Home Loans 50k Secured Personal Loan
Foundation Home Loans offers a 50k personal loan in the UK, which can be an excellent option for homeowners looking to leverage more equity in their properties.
Pepper Money Broker Loans
Utilising a broker like homeowner loans broker from Pepper Money can help homeowners find the best secured loan products available. Brokers have access to a range of lenders and can provide tailored recommendations.
Instant Loan Decision
For urgent financial needs, bad credit loans instant decision provides quick access to funds. Although these loans may have higher interest rates, they offer the convenience of immediate approval.
Secured Loan Direct Lender
Working directly with lenders can sometimes yield better terms. Secured loans direct lenders offer options for those with poor credit histories.
Secured Loans No Credit Check
Even with a less-than-perfect credit score, homeowners can explore secured loan bad credit uk. These loans use home equity as collateral, providing better terms than unsecured loans.
Consolidating Debt with Secured Loans
Secured loans can also consolidate debt, simplify repayment schedules, and reduce overall interest payments.
Debt Consolidation Loan Calculator
Using a loan calculator consolidation helps homeowners understand their repayment options and potential savings. This tool provides a clear picture of how consolidating debt can simplify financial management.
Secured Homeowner Debt Consolidation Loans
Secured loans are a popular choice for debt consolidation. By consolidating debts into one loan, homeowners can streamline their finances and potentially lower their monthly payments. Explore homeowner consolidation loans for more information.
Loans for Credit Card Consolidation
Credit card debt often carries high interest rates, making it a prime candidate for consolidation. Using a consolidating credit card debt loan to pay off credit card debt can significantly reduce interest paid and simplify repayment.
Top Debt Consolidation Companies
Finding the debt consolidation loan best rates requires research and comparison. Look for loans with favourable terms and rates that suit your financial needs.
Remortgaging to Manage Debt
Remortgaging involves replacing an existing mortgage with a new one, often with better terms. This strategy can also be used to release equity for debt consolidation, enabling more effective debt management.
Kent Reliance Remortgage Debt Consolidation
Kent Reliance offers remortgaging for debt consolidation options. This can be a practical solution for homeowners looking to restructure their debt using home equity.
Kent Reliance Mortgages for Low Credit Scores
For those with poor credit, securing a mortgage can be challenging. However, options are available to remortgage deals bad credit. Working with specialists like Kent Reliance can help find suitable products even with a less-than-perfect credit score.
Practical Tips for Homeowners and Property Investors
Both homeowners and property investors can benefit from understanding the options available and taking proactive steps to manage their finances.
- Regularly review and improve your credit score to access better loan terms.
- Use online calculators and tools to plan and understand your financial options.
- Consider professional financial advice to navigate complex loan agreements.
By leveraging secured loans and property equity, homeowners and property investors can find effective alternatives to bridging finance, thereby improving financial stability and peace of mind.