In today’s competitive UK property market, speed and the ability to make moves determine who secures the best deal. Traditional buy-to-let mortgages can take weeks to arrange and may reject properties needing refurbishment.
That’s where a personal bridging loan comes in, a short-term, interest-only finance option that lets investors act fast, purchase property, and refinance later once it’s mortgage-ready.
At Goldhill Finance, we help investors use bridging finance strategically to unlock high-return buy-to-let opportunities.
What is a bridging loan?
A short-term property loan, starting from 1 to 12 months but can go up to 24 with an optional payment plan. The finance is secured against the property and designed to help make up the gap between purchasing and longer-term finance or sale.
Key features:
- Borrowed between 1 to 12 months, extendable on payment option approval.
- Interest is often charged monthly
- Secured against property or portfolio
- Fast completion (usually within 48 hours)
- Focused on how repayment is to be settled, rather than other audits
Example:
Buy an uninhabitable property for £200,000, spend £30,000 on works, then refinance onto a buy-to-let mortgage once it’s lettable and worth £280,000.
How bridging loans power buy-to-let investment
Bridging finance is ideal for property investors looking to:
1. Buy at auction
Auctions often require completion within 28 days, far too small a timescale for a traditional mortgage to be agreed and granted. Bridging loans allow you to secure the property instantly, then refinance onto a more longer term product at a later date.
2. Refurbish unmortgageable properties
Many buy-to-let lenders won’t lend on properties without kitchens or bathrooms that need heavy work.
3. Expand portfolios quickly
Seasoned landlords use bridging finance to acquire multiple units or refinance existing assets, releasing equity for further purchases.
4. Bridge to let
A funding vehicle which allows you to buy fast, improve your home to increase its value, and then exit onto a cheaper buy-to-let mortgage once the property is tenanted and bringing in rental money.
The process: Step-by-step
- Secure a deal: Find a suitable property (auction, off-market, or distressed).
- Apply for bridging finance: Provide details of purchase, security, and your exit strategy (refinance or sale).
- Add value: Refurbish or convert the property to meet rental and mortgage standards.
- Exit: Refinance onto a standard buy-to-let mortgage or sell the property to repay the bridging loan.
Advantages for buy-to-let investors
- Speed: Move faster than mortgage buyers
- Flexibility: Finance properties in any condition
- Opportunity: Secure auction and off-market deals
- Short-term leverage: Free up equity for future projects
- Portfolio growth: Build assets strategically
When to Use a Bridging Loan (and When Not To)
Ideal for:
- Experienced landlords and property developers
- Auction buyers
- Properties needing refurbishment
- Portfolio restructuring
Avoid if:
- You lack a defined exit strategy
- You’re experience in this area is minimal
- The expected rental incomings won’t cover the loan costs
- You would be in financial difficult if unexpected costs came in to play
Example scenario
Property price: £250,000
Bridging loan: £180,000 (72% LTV) at 0.75% per month
Refurb cost: £25,000
After-refurb value: £310,000
Exit: Refinance on to a buy-to-let at 75% LTV (£232,500)
Outcome: Loan facility was repaid, £27,500 cash released, property let and generating income via rental payments
Ready to discuss your next buy-to-let project?
If you find yourself in a position where you need to move fast, add value, and grow your property portfolio, bridging is the lifeline you have been looking for.
Speak to our specialist team about your next investment project. Contact us today for a personalised quote.