Bridging Loan
Calculator UK

Calculate Your Bridging Loan Costs

Bridging finance is normally priced using a monthly interest rate. The total interest depends on the loan amount, monthly rate, loan term and the way interest is paid. The overall cost can also include arrangement, valuation, legal and broker fees.

For a simple illustration, a £200,000 loan charged at 0.75% per month would generate £1,500 of interest for one month before fees. Over a longer term, the calculation will depend on whether interest is serviced, retained or added to the balance. Actual lender calculations and charges vary.

Our bridging calculator is designed to provide an example of the cost of a non-regulated short-term property finance. It does not provide a product illustration or guarantee the rate you can secure. To get an accurate bridging loan quote, please contact our expert mortgage brokers. 

Default values 

The default values displayed are based on average bridging products currently available in the market, but you can amend these if needed. The default values include: 

• Bridging finance term (12 months)
• Interest rate (0.75%)
• Arrangement fee (2%) 
• Broker fee (0.5%) 

To use the bridging calculator, enter the property value and the amount you’d like to borrow. It will automatically calculate your loan to value (LTV).  

Alternatively, enter the property value and desired LTV, and it’ll tell you how much your net loan amount could be. 

How Are Bridging Loan Costs Calculated?

Bridging finance is normally priced using a monthly interest rate. The total interest depends on the loan amount, monthly rate, loan term and the way interest is paid. The overall cost can also include arrangement, valuation, legal and broker fees.

For a simple illustration, a £200,000 loan charged at 0.75% per month would generate £1,500 of interest for one month before fees. Over a longer term, the calculation will depend on whether interest is serviced, retained or added to the balance. Actual lender calculations and charges vary.

Retained interest

The lender calculates an agreed amount of interest at the outset and retains it from the gross facility. There are usually no monthly interest payments during the retained period, but the retained interest reduces the net funds released to the borrower.

Serviced interest

The borrower pays interest monthly as it accrues. This can preserve more of the gross facility for the transaction, but the lender will normally assess whether the monthly payments are affordable.

Rolled-up interest

Interest is added to the balance and repaid when the bridge is redeemed. This avoids monthly payments, but the balance can increase during the term. The method used varies between lenders, so the offer documentation should confirm how interest accrues.

How Does Loan to Value Affect Bridging Finance?

Loan to Value is the loan expressed as a percentage of the property’s value. For example, borrowing £350,000 against a property valued at £500,000 gives an LTV of 70%.

Many bridging lenders consider facilities around 70–75% LTV, although the maximum varies according to the property, transaction, borrower and lender. A lower LTV can increase lender choice and may support more competitive terms. Higher leverage may be available in selected cases but can involve tighter criteria or higher costs.

Commercial and Limited-Company Bridging

A bridging loan may be regulated where it is secured against a property occupied, or intended to be occupied, by the borrower or a close family member. Bridging used wholly for business or investment purposes is often unregulated. The classification depends on the circumstances, so it should be confirmed before an application proceeds.

Regulated and Unregulated Bridging Loans

A bridging loan may be regulated where it is secured against a property occupied, or intended to be occupied, by the borrower or a close family member. Bridging used wholly for business or investment purposes is often unregulated. The classification depends on the circumstances, so it should be confirmed before an application proceeds.

How Is a Bridging Loan Repaid?

A lender will require a credible plan for repaying the facility within the agreed term. Common repayment routes include selling the property, refinancing onto a residential, buy-to-let or commercial mortgage, or receiving funds from another documented source.

The proposed route should be realistic, supported by appropriate evidence and allow enough time for potential delays. If repayment is delayed beyond the agreed term, additional interest, fees or default charges may apply.

What Can Bridging Finance Be Used For?

Bridging loans provide short-term funding where speed, property condition or timing makes a conventional mortgage unsuitable. Common uses include:

• Completing an auction purchase within a short deadline
• Buying a property before an existing property is sold
• Purchasing an unmortgageable or uninhabitable property
• Funding refurbishment before sale or refinance
• Acquiring a buy-to-let property quickly
• Converting or improving a property
• Purchasing commercial or semi-commercial property
• Replacing short-term borrowing while longer-term finance is arranged

Get a Personalised Bridging Quote

The calculator is useful for testing scenarios, but the rate, fees and net loan available will depend on the property and transaction. Request a tailored quote and an MFB bridging specialist will review your requirements, timescale and available options.