Bridging Loan Rates
Bridging loan rates in the UK range from around 0.55% to 1.5% per month depending on loan to value, property type, exit strategy, and credit profile. Most mainstream deals in 2026 are priced between 0.65% and 0.95% per month. Understanding what drives your rate, and how interest is calculated, is what allows you to assess whether a quote represents a good deal or not.
Rates on this page reviewed 31 August 2026. We check the bands against live lender pricing each month. Always speak to your broker for a live quote on your specific case.
What are bridging loan rates in the UK in 2026?
The UK bridging market in late August 2026 generally prices deals within three broad bands. Where you land depends on how much risk the lender perceives in your property, your exit, and your track record.
| Rate band | Monthly rate | Typical scenario |
|---|---|---|
| Prime | 0.55%-0.65% | Sub-60% LTV, standard residential, clean credit, evidenced exit (exchanged contracts or mortgage offer) |
| Mainstream | 0.65%-0.95% | 60%-70% LTV, slightly complex property type or exit, minor credit issues, or limited bridging history |
| Specialist | 1.0%-1.5%+ | Above 70%-75% LTV, adverse credit, unusual security (HMO, semi-commercial, heavy refurbishment), or unclear exit |
The "from" rates you see advertised, often 0.49% or 0.52% per month, apply only to the best possible scenarios. Most real-world offers fall in the 0.65% to 0.95% range once lender criteria are applied to the specific deal. On very large loans above £2m, lenders compete more aggressively and pricing can drop below the prime band. Niche lending, such as mezzanine or development finance, sits above it.
Rates are quoted monthly. A rate of 0.75% per month equates to roughly 9% annualised, significantly higher than a standard mortgage at 5% to 6% per year. Bridging is a short-term, specialist product and priced accordingly.
How are bridging loan rates structured?
Monthly interest is calculated on the outstanding balance, allowing you to model costs precisely against your timeline: a £300,000 loan at 0.75% per month equals £2,250 monthly interest, or £20,250 over 9 months.
Beyond the monthly rate, the method of interest collection changes how much you actually pay and how cash flows during the term. Three structures are common in the UK market:
Serviced interest. You pay interest monthly from your own funds. The loan balance stays flat throughout. Total interest cost is lowest with this method because there is no compounding. It works well where the property generates rental income or you have cash flow to service the debt each month.
Rolled-up interest. Interest is added to the outstanding balance each month and settled in full on redemption. No monthly payments are required, which suits refurbishment projects or properties not yet generating income. Total cost is higher because you pay interest on a growing balance. On a 12-month loan, rolled-up interest can add 8% to 10% to the total amount repaid.
Retained interest. The lender advances additional funds to cover a set number of months of interest upfront, deducted from your net loan advance. You receive less cash than the gross facility but owe the full amount. If you repay early, some lenders rebate unused retained interest; others do not. Check the loan agreement before signing. A lender that rebates unused retained interest is meaningfully better for a deal where you expect to exit ahead of schedule.
Many lenders in 2026 offer hybrid structures, part serviced and part retained, which can be matched to your cash position. Always ask for two illustrations side by side: one serviced, one rolled-up or retained. Over a 6 to 9 month term the difference in total cost is often material.
According to the Bridging and Development Lenders Association (BDLA), industry loan books stood at £11.5 billion in Q1 2026, with completions of £1.8 billion in the quarter, down from £2.5 billion in Q4 2025. Applications eased to £9.9 billion from £11.7 billion, and average loan to value across the market reduced to 56.64% from 58.64%. That depth of competition among lenders is part of why pricing has held keen despite the volume growth.
What drives the rate you are offered?
Bridging lenders price loans based on perceived risk and how long their capital is tied up. The base rate influences their cost of funds, but bridging pricing reflects the short-term, specialist nature of the product rather than tracking the Bank of England rate directly.
Loan to value. The single biggest driver. Sub-60% LTV unlocks the sharpest rates. Above 70% moves you into specialist territory with fewer lenders and higher pricing. Every 5% reduction in LTV typically saves 10 to 20 basis points on your monthly rate, so improving LTV by offering an additional unencumbered property as security can make a significant difference.
Property type and condition. Standard residential property in major UK cities attracts the keenest pricing. Semi-commercial, HMO, ex-local authority, or properties requiring significant structural work command higher rates because they are harder to sell quickly if the lender needs to recover funds.
Exit strategy. A clear, evidenced exit reduces lender risk and therefore monthly cost. An AIP from a mortgage lender, exchanged sale contracts, or a formal estate agent sales appraisal all carry more weight than a statement of intent. Deals where the exit is speculative, such as "we'll refinance once planning is granted", are priced higher to reflect the uncertainty.
Loan size. Larger loans, typically above £500,000, often attract keener pricing because lenders spread fixed costs across a bigger facility. Very short terms, one to three months, sometimes include minimum interest period clauses that effectively raise the cost of a quick exit.
Credit profile. Clean credit and a track record of successful bridging or property investment reduces your rate. Recent CCJs, defaults, or mortgage arrears signal higher risk. These deals are placeable but priced accordingly, generally in the specialist band.
Regulated versus unregulated. Regulated bridging loans, for owner-occupied property under the Mortgage Credit Directive, tend to price slightly higher than unregulated investment loans for equivalent scenarios, reflecting the additional compliance burden lenders carry.
Are regulated bridging loan rates different from unregulated rates?
Regulated bridging loans for owner-occupied property tend to price slightly higher than unregulated investment loans, reflecting additional FCA compliance requirements.
| Feature | Regulated bridging | Unregulated bridging |
|---|---|---|
| Typical use | Owner-occupied purchase or refinance | Investment, commercial, development |
| Rate from (first charge) | 0.55% per month | 0.55% per month |
| Max LTV (first charge) | Up to 75% | Up to 75% |
| Max LTV (second charge) | Up to 65% | Up to 65% |
| Processing time | 3-6 weeks typical | As fast as 5-10 days |
| Access to FOS | Yes | No |
Second charge regulated bridging rates tend to be higher than first charge, typically 0.85% to 0.90% per month versus 0.55% to 0.70% for first charge at equivalent LTVs. The additional risk of second charge security is priced into the rate.
How do you calculate the true cost of a bridging loan?
True cost includes monthly interest plus arrangement fees, valuation fees, and legal costs, using the formula: total cost = (loan amount x monthly rate x months) plus all fees.
Total cost = (loan amount x monthly rate x months) + arrangement fee + valuation fee + legal fees
Here is why comparing on headline rate alone can be misleading. Two lenders quoting on a £300,000 loan over 9 months:
| Lender | Monthly rate | Arrangement fee | Interest (9 months) | Total cost |
|---|---|---|---|---|
| Lender A | 0.60% | 2% (£6,000) | £16,200 | £22,200 |
| Lender B | 0.70% | 1% (£3,000) | £18,900 | £21,900 |
Lender B's higher rate is the cheaper deal. Over a shorter term of four to five months, Lender A would win. The crossover point shifts with term length, which is why total cost over your planned timeline is the only meaningful comparison. Always ask lenders for a full cost illustration, not just a rate.
The Bank of England base rate stands at 3.75% as of September 2026, held at the July meeting after a cut from 4% in December 2025. The MPC held the rate at its 30 July 2026 meeting by a 6 to 3 vote, with the three dissenters preferring a rise to 4%. The next decision is due on 17 September 2026. Bridging loan rates do not track base rate directly, but lenders' cost of funds is influenced by it, and the falls since the 5.25% peak have fed modest downward pressure on bridging pricing through 2025 and into 2026.
How do bridging loan rates compare across different loan types?
Three worked examples illustrate how rates vary across chain breaks, refurbishments, and commercial acquisitions based on property type, LTV, and exit strategy.
Commercial security prices on a separate scale, from 0.75% to 1.25% per month, with the bands set by property type as much as by LTV. Those bands, and the worked total-cost examples behind them, are in the commercial bridging loan rates guide.
Example 1: Chain break on a London flat
Loan: £200,000 | Property value: £333,000 | LTV: 60%
Rate: 0.65% per month | Term: 7 months | Structure: Serviced
Monthly interest: £1,300 | Total interest (7 months): £9,100
Exit: Sale of existing property
The buyer's mortgage fell through and the chain collapsed. A regulated bridging loan allowed completion on the new property while the existing home was listed and sold in the normal market. Exit after 5 months instead of 7 would have reduced total interest to £6,500.
Example 2: Light refurbishment in Leeds
Gross loan: £378,000 | Net advance: £350,000 | Property value: £500,000 | LTV: 70%
Rate: 0.85% per month | Term: 9 months | Structure: Rolled-up
Total interest (rolled-up): £26,775
Exit: Refinance onto buy-to-let mortgage after works complete
A buy-to-let investor purchasing a dated rental property needing a new kitchen, bathroom, and cosmetic updates. The rolled-up structure avoided monthly outlay during the refurbishment period. On completion, a buy-to-let mortgage at 75% of the improved value cleared the bridge and all rolled-up interest.
Example 3: Commercial acquisition in the North West
Loan: £1,000,000 | Property value: £1,820,000 | LTV: 55%
Rate: 0.60% per month | Term: 12 months | Structure: Serviced
Monthly interest: £6,000 | Total interest (12 months): £72,000
Exit: Commercial mortgage refinance
A larger, low-LTV loan where multiple lenders competed for the deal. The borrower's solicitor was already instructed on the commercial mortgage, which was expected to complete within six to eight months. If the refinance completed at month 8, total interest dropped to £48,000.
How do bridging loan rates compare with a personal loan or second charge?
Bridging rates are quoted monthly and personal loan rates annually, so the two figures are not comparable as published. A bridging loan at 0.75% per month is roughly 9% a year before fees. An unsecured personal loan advertised at 7% APR looks cheaper on that basis, but it is a different product doing a different job.
Personal loans are unsecured and generally cap out between £25,000 and £50,000, which rules them out for a property purchase or a refurbishment of any scale. They also amortise, so you repay capital from month one rather than settling in a single redemption. A second charge mortgage sits between the two: cheaper on an annual basis than bridging, secured against the property, but it takes four to six weeks to complete and is written over years rather than months.
The comparison that matters is total cost over the period you actually need the money. Six months of bridging at 0.75% per month on £200,000 costs roughly £9,000 in interest plus fees. The same £200,000 held for five years on a second charge costs far more in absolute interest even at a lower annual rate, because you hold it for ten times as long. Where speed decides whether the transaction happens at all, the annualised rate is the wrong measure entirely.
Where clients get caught out is assuming a personal loan will cover a deposit shortfall on a purchase. Most lenders will not accept borrowed money as deposit, and the personal loan repayment then counts against affordability on the mortgage itself.
Which UK lenders offer the lowest bridging loan rates?
The keenest bridging pricing in mid-2026 comes from established specialist lenders including Together, MT Finance, United Trust Bank, Hope Capital, and Octane Capital, with private banks pricing below all of them for qualifying high net worth borrowers. No single lender is cheapest across every scenario. Each has property types, loan sizes, and regions where it prices to win and others where it does not.
Together and MT Finance are consistently sharp on standard residential security at sensible LTVs. United Trust Bank competes hard on regulated cases and larger loans. Hope Capital and Octane Capital price aggressively on investment property and more complex security where the exit is well evidenced. On loans above £1m to borrowers meeting the FCA high net worth definition, private bank routes can undercut the entire specialist market, with rates from around 0.3% per month; our private bank bridging guide covers how that works.
The practical point is that published rate cards are a starting position, not a price. Around half the deals we place complete at a rate below the lender's published card because the case was packaged to the lender whose appetite matched it. Send the same case to the wrong lender and you get the top of the band or a decline. That matching exercise is the job.
Lender names and rate positioning correct at time of review, 31 August 2026. Lender appetite changes frequently.
What other costs come with a bridging loan beyond the monthly rate?
Beyond monthly interest, typical costs include arrangement fees (1-2%), valuation fees (£500-£1,500), legal fees (£2,000+), and exit administration fees (£100-£250).
Arrangement fees are typically 1% to 2% of the gross loan amount and are usually added to the facility rather than paid upfront. On a £500,000 loan, that is £5,000 to £10,000 added to the total debt. Larger loans occasionally attract lower percentage fees as lenders compete for the business.
Valuation fees are paid upfront and vary with property value and type. A straightforward £400,000 residential property typically costs £500 to £700. A £1.2m commercial unit or development site can be £1,500 or more. You pay this regardless of whether the loan completes.
Legal fees cover your own solicitor plus the lender's legal team. Combined costs frequently exceed £2,000 on straightforward cases and rise for complex deals involving multiple titles or unusual security.
Exit and administration fees are smaller but should be disclosed upfront. A redemption administration charge of £100 to £250 is common. Some lenders also impose minimum interest periods, typically three months, meaning you pay for the full minimum term even if you exit earlier. Genuinely penalty-free early repayment is available from many lenders but not all.
For a full breakdown of all costs across the loan lifecycle, see our bridging loan costs and fees guide.
How do you get the best bridging loan rate in the UK?
The best rates go to borrowers who prepare carefully: reducing LTV below 60%, evidencing their exit, using a specialist broker with direct lender access, and comparing on total cost rather than headline rate.
Know your LTV before you approach anyone. Get a realistic current market valuation, not an aspirational one. If you can reduce LTV below 70%, and preferably below 60%, you unlock materially better pricing. If you have an unencumbered property that could be offered as additional security, the resulting LTV reduction is often worth more than any other single factor.
Evidence your exit. Lenders do not price speculatively. An AIP from a mortgage lender for the refinance, exchanged contracts on the property sale, or a formal estate agent sales appraisal gives the lender confidence in your exit. Vague exit strategies attract higher rates and sometimes outright declines.
Use a specialist broker with direct lender access. The best-priced bridging lenders operate on a relationship basis and are not found on comparison sites. A specialist broker with full access to the bridging market can typically secure rates 0.15% to 0.3% per month lower than you would achieve going direct. On a £500,000 loan over 9 months, 0.2% per month is £9,000. That covers a broker fee with a clear margin.
Compare on total cost, not headline rate. Use the formula above: interest over your planned term plus all fees. Request a full cost illustration from each lender. The lender with the lowest monthly rate is rarely the cheapest deal once fees are included.
What we see repeatedly in the deals we arrange is that borrowers who arrive with a clean application, a clear exit, and realistic LTV figures consistently achieve better rates than those who come in unprepared and then try to negotiate. Lender pricing is risk-based. Remove the risk and the rate follows.
What are the risks of taking out a bridging loan?
The main risks are exit delays adding significant interest cost, interest arrears triggering default rates, and property value falls leaving refinances unable to clear the balance.
Interest rate changes. Most bridging loans are fixed for the agreed term, so your rate will not change mid-loan. However, if you need to extend or refinance onto a new facility, new quotes reflect the current market. If rates have moved since your original loan was arranged, extensions will cost more.
Exit delays. A sale that takes three months longer than expected, or a refinance delayed by survey issues, adds significant cost. Three extra months at 0.80% per month on a £500,000 loan is £12,000. Extensions may also trigger fees. Build contingency of at least two to three months into your timeline and budget accordingly.
Serviced interest arrears. Where interest is paid monthly, missed payments can trigger default interest rates, which are substantially higher than the contracted rate, and eventually enforcement action. If your cash flow during the loan term is uncertain, a rolled-up or retained structure removes this risk at the cost of a slightly higher total outlay.
Property value risk. If values fall between loan origination and exit, your refinance may not clear the outstanding balance. This is particularly relevant on properties where values are susceptible to market conditions or where significant works are being carried out. Lenders assess this risk when setting LTV; borrowers should too.
Your property may be repossessed if you do not keep up with repayments or repay the loan as agreed.
Bridging loan rates: frequently asked questions
Is a bridging loan cheaper than a personal loan?
Not on an annualised basis. Bridging at 0.75% per month is around 9% a year before fees, against roughly 7% APR on a well-priced unsecured personal loan. The comparison misses the point, because personal loans are unsecured, generally cap out between £25,000 and £50,000, and amortise from month one. For a property purchase or a refurbishment the personal loan is not an option at all, and over a six month term the absolute interest cost on bridging is usually the lower of the two.
What are typical bridging loan rates in 2026?
Most UK bridging loans in 2026 are priced between 0.55% and 1.1% per month. Prime deals at sub-60% LTV with clean credit and a clear exit start from around 0.55% per month. Complex cases, including adverse credit, unusual property types, or higher gearing, typically sit between 1.0% and 1.5% per month.
Are bridging loan rates quoted monthly or annually?
Bridging rates are quoted per month. A rate of 0.75% per month equates to roughly 9% annualised, considerably higher than a standard mortgage expressed as an annual percentage. Always convert to annual equivalent or total cost when comparing bridging against other forms of finance.
What is the lowest bridging loan rate available?
The lowest rates in the UK market in 2026 start from around 0.49% to 0.55% per month. These apply only to the strongest scenarios: sub-55% LTV, prime residential security, clean credit, and a locked-in exit. Most borrowers receive offers in the 0.65% to 0.9% range once lender criteria are applied to the actual deal.
What factors affect my bridging loan rate?
The main factors are loan to value, property type and condition, exit strategy, loan size, and credit profile. LTV is the single biggest driver: sub-60% unlocks the sharpest rates, while above 70% to 75% moves into specialist territory. A credible, evidenced exit also has a significant impact on pricing.
What is the difference between rolled-up, retained, and serviced interest?
Serviced interest means monthly payments during the loan, keeping the balance flat and total cost lower. Rolled-up interest is added to the balance monthly and settled on exit, suited to properties not generating income during the term. Retained interest is deducted from the gross advance upfront, with some lenders rebating unused portions on early exit.
Is a lower rate always the best deal?
Not necessarily. A lower rate with a high arrangement fee can cost more overall than a slightly higher rate with minimal fees, particularly on short terms of three to four months. Always compare on total cost over your planned term, including all interest, arrangement fees, valuation fees, and legal costs.
Can I get a bridging loan with bad credit?
Yes, but rates will sit towards the higher end of the market. Adverse credit, including recent CCJs, defaults, or mortgage arrears, signals higher risk. You can offset this through lower LTV or additional security. Some specialist bridging lenders focus on adverse credit cases, though their pricing reflects the additional risk.
What happens if I need to extend my bridging loan?
Extensions are available from most lenders but add cost. You will pay interest for the extended period and may face an extension fee of 0.5% to 1% of the loan amount. If market rates have moved since your original loan was agreed, the new rate may be higher. Build contingency of two to three months into your budget from the start.
Do regulated and unregulated bridging loans have different rates?
Generally yes. Regulated bridging loans for owner-occupied property tend to price slightly higher than unregulated investment loans for equivalent scenarios, reflecting the additional compliance requirements. First charge regulated rates typically start from 0.55% to 0.65% per month. Unregulated loans on investment property often attract sharper pricing at lower LTVs.
Which UK lenders offer the lowest bridging loan rates?
Established specialist lenders including Together, MT Finance, United Trust Bank, Hope Capital, and Octane Capital offer some of the keenest bridging pricing in 2026, each in different scenarios. For high net worth borrowers on loans above £1m, private banks can price from around 0.3% per month, below the whole specialist market. The cheapest lender depends on your property, LTV, and exit.
How do I know what rate I will actually get?
Online rates are indicative only. The only way to know your actual rate is through a formal terms in principle from a lender, or via a specialist broker who can assess your specific property, LTV, exit, and credit profile against multiple lenders simultaneously. A broker with full market access will identify lenders likely to price your deal at the lower end of the relevant band.
Bridging loan rates and product details are indicative only and subject to change. The rate you are offered will depend on individual circumstances including loan to value, property type, exit strategy, and credit profile. Your property may be repossessed if you do not repay the loan as agreed. FD Commercial arranges bridging loans from £250,000.
FD Commercial arranges bridging loans from £250,000 across England, Scotland, and Wales. We have direct access to lenders across the full rate spectrum and can tell you, quickly, where your deal is likely to price and which lenders are most competitive for your specific scenario.
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