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Auction Finance Bridging Loans – Fast Property Funding Made Simple

In the market of property purchases, Auction Finance Bridging Loans provide quick, hassle-free funding when you need it most. With flexible exit options, automated valuations, and solutions for UK, non-UK, and expat applicants, we make securing short-term finance simple and efficient. From competitive SLAs to second charge bridges, we’ve got you covered.

What is a Bridging Loan?

  • A bridging loan is a short-term loan designed to ‘bridge the gap’ during property purchases, typically used when buying at auction or purchasing a new property before selling an existing one. These loans are secured against assets like your home, providing the lender with collateral.
  • While they offer fast access to finance, it's important to understand the risks involved, as failure to meet repayments could result in the loss of your property.

Here’s how bridging loans work

Pay the deposit: You need a £100,000 deposit for a £350,000 property, with the rest borrowed via a mortgage.

Plug the gap: You only have £25,000 in savings, leaving a shortfall of £75,000.

Use bridge finance:A bridging loan covers the £75,000 gap until your current property is sold.

Repay the loan: Once your existing property sells, you repay the loan and interest, clearing the debt.

Types of Bridging Loans

Bridging loans come in various forms, each designed to suit different financial situations. Understanding these options helps you choose the right loan for your needs.
First charge and second charge

A charge on your property dictates the repayment order of your loans.

Closed bridge loan

Set repayment date, ideal when you’re waiting for a property sale to complete.

Fixed or variable interest

Fixed rates provide certainty, while variable rates fluctuate with the market.

Impact of base rate cuts

Lower base rates can reduce APRs on bridge loans, making borrowing cheaper.

Open bridge loan

No fixed repayment date but typically repaid within 12-24 months.

Lender response to rate cuts

Not all lenders pass on savings immediately; some may adjust rates slowly.

What Fees Will You Pay on a Bridging Loan?

When considering a bridging loan, it’s important to understand the associated fees. These costs can vary, but Auction Finance is here to help make the process as smooth and affordable as possible, our bridging loan calculator can give you a quick estimate of what you might pay based on your loan amount and terms. From valuation to legal fees, we can assist you in navigating the financial landscape while ensuring transparency and efficiency.

  • You will likely encounter valuation fees, which assess your property’s value. At Auction Finance, we work with lenders who offer desktop or automated valuations to save you time and reduce costs. Additionally, you may face arrangement fees, typically around 2% of the loan, and possibly exit fees, though most of our lender partners don’t charge these. Legal fees are also standard, but we can connect you with lenders offering dual representation to cut both time and expenses.
  • With Auction Finance, you can borrow anywhere from £5,000 to millions, depending on your circumstances, and up to 75% of your property’s value. We're here to guide you through the process and ensure you get the best possible deal for your needs.

What Sets Auction Finance Apart in Bridging Loans?

At Auction Finance, we pride ourselves on offering exceptional bridging finance solutions tailored to your unique needs.

With interest rates starting as low as 0.55%, we empower you to borrow amounts ranging from £20,000 to an incredible £1 billion, ensuring that you have access to the capital required for your property ventures. Our extensive market access guarantees that you’ll find the most favourable terms available, giving you peace of mind during your financial journey.

If you’re considering 100% bridging finance, it is possible with the right assets and guidance. However, securing such funding requires a broker who can connect you with willing lenders, as well as a clear understanding of your property type, location, and exit strategy. Since each situation is unique, we encourage you to consult with our bridging finance advisors. They will thoroughly assess your circumstances and help you determine if 100% funding is achievable for you, ensuring you make informed decisions every step of the way.

We also assist clients exploring alternative finance solutions like secured loans, ideal when additional capital is needed without refinancing your entire mortgage or property portfolio.

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Why Choose Auction Finance for Your Bridging Loans?

At Auction Finance, we offer a comprehensive range of bridging loan solutions tailored to meet diverse property needs. Whether you’re purchasing residential or commercial properties, our expert team is here to help you navigate the financing landscape efficiently and effectively.

Residential Property Bridging Loans

Ideal for fixing chain breaks, mortgage delays, Buy-to-let investments , property flips, and purchasing properties with short leases.

Commercial Property Bridging Loans

Flexible funding for semi-commercial and commercial property purchases.

Fast Auction Bridging Loans

Quick financing solutions for residential and commercial auction purchases, ensuring you meet tight 28-day completion deadlines.

Refurbishment and Development Finance

Support for light and heavy refurbishments, development projects, and business-related financing to help you achieve your goals.

Frequently Asked Questions

Yes, it is possible to secure a bridge loan even with a poor credit score; however, you may be offered less favourable interest rates compared to borrowers with better credit ratings.

The repayment period for bridging loans can vary by lender, but these loans are typically short-term, lasting up to 12 months.

Bridging loans are processed relatively quickly due to their short-term nature. You can expect approval within 5 to 21 days.

You can use our loan calculator to estimate your borrowing capacity and see how it aligns with your desired loan-to-value (LTV) ratio.

If you are unable to meet your bridging loan repayments, you risk losing your property and negatively impacting your credit score.

Absolutely. Many landlords opt for bridging loans to secure deposits for their buy-to-let investments.

While bridging loans are generally quicker to arrange than mortgages, the timeline can range from a few days to several weeks. This is due to the need for property valuations and credit checks when using your asset as collateral.

To secure a bridging loan, you’ll need to provide equity from your current home or another valuable asset as collateral. Typically, our partner Fluent requires at least 35% equity.