Commercial bridging rates, in context.
A commercial bridging loan is priced as a monthly interest rate plus fees. The rate you are offered depends on the loan to value, the type and condition of the building, the charge position and, most of all, how convincing the exit is. We set out every cost before you commit.
Six factors that move your price.
We do not publish a headline rate, because a headline rate tells you nothing about your deal. These are the things lenders actually price on.
An investor buys a vacant office at auction for £800,000, bridges £560,000 for 12 months and puts in the balance plus costs. Interest is retained, so nothing is paid monthly. Once the floors are let, the bridge is repaid by a commercial investment mortgage. The figures show the structure only and are not a quote.
Loan to value
The single biggest factor. Lower LTV means less risk for the lender and a lower monthly rate. Each step down in LTV usually moves you into a cheaper pricing tier.
Property type and condition
A let, modern industrial unit prices better than a vacant, specialist or tired building. Lenders price for how quickly they could sell the asset if they had to.
Exit strategy
A sale already agreed, a refinance in principle or comparable evidence for the end value all sharpen pricing. A vague exit does the opposite.
Charge position
A first charge is cheapest. A second charge behind an existing lender carries more risk and costs more.
Borrower profile
Experience with similar projects, a clean credit history and strong guarantors help. Adverse credit does not rule a case out but affects price.
Term and size
Larger loans often attract keener pricing from lenders who want volume, and a realistic term avoids paying for extensions later.
The fees on a commercial bridge.
| Cost | How it works |
|---|---|
| Interest | Charged monthly on the balance. Retained, rolled up or serviced. Some lenders have a minimum interest period of one to three months. |
| Arrangement fee | A percentage of the gross loan, usually added to the loan rather than paid up front. |
| Exit fee | Charged by some lenders on redemption, often as a percentage of the loan. Many commercial bridging products have none, so compare carefully. |
| Valuation | Paid up front to the lender's chosen surveyor. Varies with property value and complexity. |
| Legal costs | You pay your own solicitor and the lender's legal costs. |
| Broker fee | Where charged, agreed in writing before any work begins. No charge to enquire. |
Retained, rolled up or serviced interest
Retained interest is deducted from the advance for the whole term, so you pay nothing monthly but receive less cash; unused interest is usually refunded if you repay early. Rolled-up interest is added to the balance each month and compounds. Serviced interest is paid monthly from income and is cheapest overall, but needs cash flow. Compare the three in detail.
Compare total cost, not the rate
A lower monthly rate can hide a higher arrangement fee or an exit fee. Over a six-month bridge, fees can outweigh the difference in rate. Our total cost calculator puts offers on the same footing.
What are commercial bridging loan rates?
Commercial bridging is priced as a monthly interest rate. The rate depends on loan to value, the property, the charge position, the exit and the borrower, so two deals in the same week can price very differently. We obtain real terms from several lenders for your specific case rather than quoting a headline figure.
Why are bridging rates quoted monthly?
Because the loans are short. Most commercial bridges run for months rather than years, and interest is charged only for the months the loan is outstanding. Multiply a monthly rate by twelve for a rough annual comparison, but remember you rarely hold a bridge that long.
How much would a £200k commercial bridging loan cost?
Use our cost calculator with the term and the rate you are offered: it adds interest, arrangement, exit, valuation and legal fees into one figure. As a principle, fees weigh more heavily on short terms and interest on long ones, so the cheapest product depends on how long you will hold it.
Are bridging rates higher for commercial property than residential?
Often slightly, because commercial buildings are harder to value and slower to sell. But a strong commercial asset at a sensible LTV can price as keenly as a residential investment bridge. The property and the exit matter more than the label.
Can I reduce the cost of a commercial bridge?
Lower the LTV with more equity or additional security, evidence the exit well, choose serviced interest if you have the income, and keep the term realistic. Comparing the total cost of offers, not just the rate, is the most reliable saving.
Tell us about the property and the loan you need. We come back with indicative terms and tell you plainly if any part of it is regulated.