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By Pete Mugleston | Mortgage Advisor

Pete has been a mortgage advisor for over 10 years, and is regularly cited in both trade and national press.

Updated: 24th June 2020*

We get countless enquiries from customers who wants to know whether they can get a bridging loan anywhere in the UK. Some are looking for finance in Scotland, others in Northern Ireland  and many in England and Wales. We even hear from prospective borrowers who want to use a bridge loan to invest in property overseas.

That’s why we’ve put together this guide outlining where bridging loans are available in the UK, where you might struggle to get them, and how to secure one for overseas investment.

The following topics are covered below…

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Can I get a bridge loan anywhere in the UK?

Bridging loans are available across most of the UK, but some lenders place restrictions and have specific rules that only apply in certain locations, including…

  • London
  • Scotland
  • Northern Ireland

Bridging finance in London

Bridging finance is readily available in most of England and Wales’ major towns and cities, such as Manchester, Birmingham, Blackpool and many other locations.

Those in the market for bridging loans in London will also have a wide variety of lenders to choose from, as most operate there. Indeed, London might be your only option with a minority of lenders as there are bridging providers with minimum loan/property values so high that only projects in the UK capital will meet their eligibility requirements.

If you’re looking for the top bridging loans in London with the best rates, get in touch and the whole-of-market advisors we work with will connect you with the lenders offering them.

What is the maximum LTV for bridging loans in England?

Most UK bridging lenders cap LTV (loan to value) at 70-75% for deals with minimal risk, and this applies across England.

For higher risk deals, some lenders place a strict cap on LTV, dropping it to anywhere between 65% and 50% of the gross loan amount, which means you would usually need a deposit of more than 35%.

It is possible to get 100% LTV bridging loans from some UK lenders, but this would require putting up additional assets/properties as security. Most providers are happy with multiple security, but they may expect you to pay additional valuation fees in these scenarios.

Getting the best rates – what is classed as a low risk bridging loan?

Whether you’re looking for bridging loans in Middlesex, Hertfordshire, London, or anywhere else in the UK for that matter, getting the best rates is all about being viewed by the lender as a low risk borrower, and you can do this by meeting their eligibility requirements.

All bridging loans are judged on a case-by-case basis, but the majority lenders reserve the most favourable rates for customers with the following…

  • A strong exit strategy:
    You’re unlikely to get a bridging loan of any kind without evidencing an exit strategy, and the more likely it is to pay off, the better as far as the lender is concerned. When a bridge loan is used for property investment/development, the exit is usually a remortgage or the sale of the property in question, so expect the lender to scrutinise the project to determine how sellable the property is or how much it could remortgage for. They will need to see that your plans are realistic and profitable enough to settle the loan amount in full.
  • Clean credit:
    Bad credit isn’t a deal-breaker for some bridging lender as there are providers who would be willing to overlook it if the exit strategy is strong. That said, clean credit can help you get the best rates. Certain lenders might turn away borrowers with adverse if the exit strategy is a remortgage, and underwriters may be concerned about the possibility of further adverse during the loan term.
  • Experience in property:
    Although there are bridging lenders who specialise in first-time investors, having experience in property will help you convince the provider that your project is low risk. Indeed, some lenders will insist on experience if it’s a complex development project and may request evidence of past projects.

Above all, the lender will be keen to see that the investment is viable, and they’ll judge that by looking at the above factors as well as other variables such as the scheme’s location, as this can affect sellability. Make an enquiry for more information about eligibility.

Bridging loans in Scotland

If you’re looking for bridging finance in Scotland, this may call for a specialist lender as not all of them are willing to provide loans for projects north of the border.

Some of the bridging lenders that do cover Scotland will place restrictions on certain postcodes. Bridging loans in Glasgow, for example, are available to eligible borrowers but you might struggle to find a provider that covers the Scottish Highlands.

For projects in mainland Scotland, you’re looking at the same rates and criteria as you’d get in England. Loan to value (LTV) will only differ if it’s a particularly complex project – for instance, a land bridging finance deal in Edinburgh might come with capped LTV, as land purchases in general are considered higher risk than property bridging loans.

As fewer lenders cover Scotland, it’s important to seek whole-of-market advice before taking out a bridging loan there, as it will significantly increase your chances of ending up on the best rates.

Get in touch and the advisors we work with will connect you with the lender best equipped to provide a bridging loan to somebody in your circumstances.

Bridging loans in Northern Ireland

Bridging finance in Northern Ireland is certainly possible to obtain, but you may find that your lender options are as restricted as they would be up in Scotland.

This is because there are only a minority of bridging finance lenders who cover Northern Ireland, and even they only agree to certain postcodes.

Your chances of finding one will increase if it’s an unregulated bridging loan you’re after – i.e. one for investment/commercial purposes – but specialist advice is still recommended.

To find the best bridging loans in Ireland, make an enquiry and the whole-of-market advisors we work with will connect you with the right lender.

International bridge loans

A minority of bridging lenders would be willing to offer you a loan to secure an overseas property. Here’s how that would work: if you’re seeking a property in Australia, for example, you could secure a bridging loan against a UK-based property or asset you already own, and use the funds to snap up a new property in Oz ahead of a rival buyer.

The loan could either be settled via a remortgage through an international lender, the sale of the UK-based assets (assuming that fits in with the timeframe) or through a ‘non-standard’ exit strategy, such as using investments, endowments or inheritance to settle the loan.

Some lenders will approve a non-standard exit, but will expect to see proof that the funds are due to enter your bank account within a certain timeframe (usually a matter of months), and may charge interest daily, rather than monthly.

International bridging lenders

Alternately, the advisors we work with have access to international bridging lenders who can provide…

  • Bridging loans in France
  • Bridging loans in Spain
  • Bridging loans in Portugal
  • Bridging loans in Italy
  • Bridging loans elsewhere in Western Europe
  • Bridge financing in the US and Canada
  • Bridging loans in South Africa

There are also specialist international bridging lenders who may consider offering the following on a case-by-case basis…

  • Bridging finance in NZ
  • Bridge loans in India
  • Bridging loans in Singapore
  • Bridging loans in Malaysia
  • And bridging loans in many other international territories

The minority of bridging providers who offer loans for international projects will judge each application on its own merits measuring up the potential risk vs. rewards on offer and the strength of the exit strategy.

Whether you’re seeking a bridge loan for a mortgage in Canada or international bridging finance for to invest in a property in California, get in touch and the whole-of-market advisors we work with will connect you to the right specialist lender.

Can I get a bridging loan for a buy to let property outside of England?

Yes, there’s no reason why the lenders who cover Scotland, Northern Ireland and further afield won’t consider a bridge to let application.

The maximum LTV on these deals is usually 75% and you can expect the lender to offer you a decision in principle on the buy to let aspect of the agreement while the bridge loan is being arranged. The valuation, and every other element of the buy to let mortgage, must meet the lender’s standard criteria for these products.

Can I get a bridge loan outside of England if I trade as a Ltd company?

Again, there’s no reason why a specialist lender who offers bridge loans outside of England would turn away a limited company borrower if they meet the eligibility criteria.

Limited company bridge loan applications are treated similarly to Ltd company buy to let applications by most lenders, and subject to the same criteria. For instance, some will ask for personal guarantees from the company directors before releasing the funds.

The Ltd company doesn’t necessarily need to be a special purpose vehicle (SPV) for bridging finance, though it may improve your chances of landing a deal if you are set up that way.

Can I get a second charge bridge loan outside of England?

A favourable deal might be difficult to come by as many lenders do not offer second charge bridging loans. Some specialists do, but the rates can be even higher.

That said, with whole-of-market access, it may be possible to find a provider that covers regions outside of England and offers favourable deals on second charge bridging loans, so make an enquiry and the advisors we work with will track down the best deals.

Speak to a bridging loans expert

Whether you’re seeking a Scottish bridging loan, the best bridging loans in London or bridging finance to invest in a project much further afield, call Online Mortgage Advisor today on 0808 189 2301 or make an enquiry here.

Then sit back and let us do all the hard work in finding the bridging finance lender with the right expertise for your personal circumstances. We don’t charge a fee and there’s absolutely no obligation or marks on your credit rating.

Updated: 24th June 2020
OnlineMortgageAdvisor 2020 ©

FCA disclaimer

*Based on our research, the content contained in this article is accurate as of most recent time of writing. Lender criteria and policies change regularly so speak to one of the advisors we work with to confirm the most accurate up to date information. The info on the site is not tailored advice to each individual reader, and as such does not constitute financial advice. All advisors working with us are fully qualified to provide mortgage advice and work only for firms who are authorised and regulated by the Financial Conduct Authority. They will offer any advice specific to you and your needs. Some types of buy to let mortgages are not regulated by the FCA. Think carefully before securing other debts against your home. As a mortgage is secured against your home, it may be repossessed if you do not keep up with repayments on your mortgage. Equity released from your home will also be secured against it.