Refinance

“I need to raise money quickly against a property I already own”

Where equity needs releasing faster than a term remortgage allows, a bridging loan secured on the property can complete in weeks rather than months. It can be a first charge, or a second charge behind an existing mortgage that stays in place.

An illustrative situation, not a client case study. It describes the kind of enquiry this market sees. Any figures are examples, not a quotation, and no credit check or lender decision is involved in reading this.

Sound familiar?

You own property with meaningful equity, mortgaged or unencumbered
You need the funds in weeks — a deposit, a tax bill, a business opportunity
A remortgage would work but will not complete in time
You have a clear plan for repaying the short-term facility

The situation

This is bridging used as a cash-flow tool rather than a purchase tool. The property is fine, the equity is real, and the only problem is that term lending moves at term-lending speed.

It is also where the exit matters most. There is no sale forcing the repayment, so the lender needs to see exactly what will clear the facility and when.

Why the usual lenders say no

A remortgage typically takes two to three months, which defeats the purpose.
Further advances from an existing lender are often slow and restricted in purpose.
Some uses of funds — a tax liability, for instance — sit outside mainstream lending criteria entirely.

What usually works

A first charge bridge on an unencumbered property

The simplest structure available. No existing lender to redeem or obtain consent from, which usually makes it the quickest.

A second charge behind an existing mortgage

Keeps a good rate or avoids an early repayment charge, but the first lender must consent and pricing is higher because the security position is weaker.

Evidencing the use of funds

Lenders will ask, and for regulated cases they must. A clear, documented purpose speeds a case up considerably.

A realistic exit

Usually a term remortgage arranged in parallel, or a sale. "Something will turn up" is not an exit and will not get funded.

Roughly how the numbers look

Illustrative figures for this situation
First charge loan to value	Typically up to 75% gross
Second charge loan to value	Lower, and priced higher
Term	Commonly 6 to 18 months
Speed versus a remortgage	Weeks rather than months, at a higher monthly cost

If a term remortgage can be arranged in time, it will almost always be cheaper. Bridging exists for when it cannot. These are examples to show the shape of a deal, not a quotation. Work out your own figures in the bridging calculator.

What we would need from you

Details of the property and any existing mortgage, with a redemption statement
What the funds are for, with supporting evidence
Your exit: a term lender’s decision in principle, or an agent’s sale appraisal
Rental statements if the property is let
Photo ID and proof of address
Accounts or SA302s if the exit is income-assessed

Things that catch people out

Second charge cases depend on the first lender consenting, and they have no reason to hurry.
If the property is your home, this is likely to be regulated lending with a narrower lender panel.
Short-term money used to plug an ongoing shortfall rarely ends well. Be honest about what the problem actually is.

Questions we get asked

Can I release equity from a property I own outright?

Yes. An unencumbered property is straightforward security, and the absence of an existing charge usually makes the process quicker.

What is a second charge bridging loan?

A loan secured behind an existing mortgage, which stays in place. It avoids redeeming a mortgage on good terms or paying an early repayment charge, but the first lender must consent and the rate is higher.

Will the lender ask what the money is for?

Yes. Use of funds is part of the underwriting, and for regulated cases it is a requirement. Vagueness slows a case down considerably.

The product that usually fits

See how it works

Every case is different. A specialist will confirm what actually fits yours.

Rather talk now?

020 4525 4876

9:00am – 5:30pm, Monday to Friday

Keep reading

Related situations and guides

“My bridging loan is about to expire and the property has not sold”

The term is nearly up, the sale has not happened, and default pricing is approaching.

Read the scenario

“My business rents its premises and I want to buy the freehold”

The landlord is selling, or the lease is ending, and buying is better than renewing.

Read the scenario

Bridging loan exit strategies explained

Sale, refinance or something else: how lenders underwrite your exit, what evidence they want, and what happens if the exit slips.

Read the guide

How much does a bridging loan cost?

Every cost in a bridging loan, from the monthly rate to the fees that get added to the balance, with a worked example you can check in our calculator.