Unlocking the Secrets to Bridging Loan Approval!
A Beginners Guide
Bridging loans are a powerful tool for homebuyers, property developers, and investors in the UK. They provide fast, short-term financing to secure property purchases, refurbishments, or development projects. However, many first-time applicants worry about their eligibility. What does it take to get approved for a bridging loan?
At Sunrise Commercial Finance, we’ve helped countless clients secure bridging loans quickly and efficiently. Here’s what lenders look for when assessing your application and how you can improve your chances of approval.
1. Credit History – Does It Matter?
Unlike traditional mortgages, bridging loan lenders are more flexible when it comes to credit history. While a good credit score can help secure better rates, even those with adverse credit (such as CCJs or late payments) may still be eligible. The key factor for lenders is the security of the loan rather than creditworthiness alone.
Common Credit Issues Bridging Lenders Accept:
- Low credit scores – Not always a dealbreaker
- Missed payments – Some lenders accept minor defaults
- County Court Judgments (CCJs) – Can be considered depending on the amount
- Bankruptcy history – Some lenders specialize in adverse credit bridging loans
How to improve eligibility:
- Check your credit report for errors and correct them before applying.
- Be prepared to explain any financial difficulties that have affected your credit history.
- Consider working with an experienced bridging loan broker to find a lender specializing in adverse credit applicants.
2. Income Requirements – Do You Need a High Salary?
Many bridging loans are not based on income multiples like traditional mortgages. Instead, lenders focus on the exit strategy (more on this below) and the value of the secured property.
Who Can Apply for a Bridging Loan?
- Self-employed individuals – Many lenders do not require proof of consistent income
- Investors – Rental income is often acceptable
- First-time buyers – Some lenders accept first-time investors with strong exit strategies
- Limited companies & partnerships – Business structures can also secure bridging loans
How to improve eligibility:
- While not always required, having a stable income can provide additional reassurance to lenders.
- Demonstrating experience in property development or investment can strengthen your application.
3. Exit Strategy – The Most Important Factor
An exit strategy is how you plan to repay the bridging loan. Lenders want to see a clear and viable repayment plan before approving your application.
Common Exit Strategies:
- Selling the property after development or refurbishment.
- Refinancing onto a long-term mortgage (e.g., buy-to-let or residential mortgage).
- Using funds from an inheritance or other financial windfalls.
- Selling other assets to repay the loan.
How to improve eligibility:
- Provide a well-documented exit strategy with supporting evidence (e.g., mortgage agreements in principle, estate agent valuations, etc.).
- Be realistic with your timescales – lenders prefer exit strategies that can be executed within 6–12 months.
4. Property Type – What Can Be Used as Security?
Bridging loans are secured against property or land. The type and condition of the security impact your eligibility.
Eligible Properties Include:
- Residential properties (including buy-to-let and HMOs)
- Commercial properties (such as offices, warehouses, or retail spaces)
- Development sites (land with or without planning permission)
- Unmortgageable properties (such as those needing refurbishment)
How to improve eligibility:
- Ensure the property has a clear and marketable title.
- Provide a professional valuation report if possible.
- If the property is in poor condition, have a refurbishment plan in place.
5. Loan-to-Value (LTV) – How Much Can You Borrow?
Most lenders offer bridging loans up to 75% of the property’s value, although some may lend more with additional security.
Typical Bridging Loan LTV Limits:
- Standard bridging loans – Up to 75% LTV
- Refurbishment loans – Up to 80% LTV (including interest rolled up)
- Development finance – Up to 100% of build costs with additional security
How to improve eligibility:
- A larger deposit or additional assets can increase the chances of approval.
- A lower LTV means better rates and easier approvals.
6. Regulated vs. Unregulated Bridging Loans
Regulated Bridging Loans:
- Used for residential properties where the borrower or family will reside.
- Overseen by the Financial Conduct Authority (FCA).
- Stricter lending criteria but offers consumer protection.
Unregulated Bridging Loans:
- Used for commercial properties, buy-to-let, or development projects.
- No FCA oversight, so criteria can be more flexible.
- Suitable for investors and developers.
How to improve eligibility:
- Choose the right type of bridging loan based on your project.
- Ensure you work with a reputable lender or broker.
7. Speed of Application – How Fast Can You Secure a Loan?
One of the biggest advantages of bridging loans is speed. With the right preparation, funding can be secured in as little as 48 hours.
Bridging Loan Process:
- Initial enquiry & application – Provide basic details and property information.
- Decision in principle – Lender assesses viability and offers terms.
- Valuation & legal checks – Surveyors assess property value, legal due diligence is completed.
- Funds released – Once all checks are complete, the loan is issued.
How to improve eligibility:
- Have all necessary documents ready, including ID, proof of address, property details, and a clear exit strategy.
- Work with an experienced bridging loan broker like Sunrise Commercial Finance to navigate the process smoothly.
Common Mistakes to Avoid When Applying for a Bridging Loan
- Not having a clear exit strategy – This is the biggest reason for rejection.
- Underestimating costs – Factor in interest, legal fees, and valuation fees.
- Choosing the wrong lender – Not all lenders are suitable for every situation.
- Ignoring loan terms – Ensure you understand repayment terms and interest structure.
Final Thoughts – Get Your Bridging Loan Approved Today!
Understanding bridging loan eligibility is key to securing fast property finance. Even if you’re new to property development or investing, a strong exit strategy, a viable security asset, and proper planning can significantly boost your chances of approval.
Need expert guidance? Contact Sunrise Commercial Finance today for a free consultation and tailored bridging loan solutions.
👉 For more information contact us for a fees free chat.
To keep informed of our latest property articles about all things property follow us on facebook
📞 Call us at 07939 091418
📧 Email: john@sunrisecommercial.co.uk
🌐 Visit: https://www.sunrisecommercial.co.uk/
#BridgingLoans #PropertyFinance #PropertyInvestment #UKProperty #BridgingLoanBroker #RealEstateFunding #FastFinance #Homebuyers #PropertyDevelopment #InvestmentLoans #ShortTermFinance #BuyToLet #HMOInvesting #PropertyRefurbishment #DevelopmentFinance