Can I Pay Back a Bridging Loan Early?

A lender will almost always allow you to pay the loan back earlier than initially planned. Depending on the lender and the circumstances of the loan, you may be charged a fee for paying this back early, known as an early exit penalty. This fee is not always charged, so it’s important to check whether it applies to you before opting for an early repayment.

A bridging loan is intended as a short term means of finance, with regulated companies typically offering a maximum loan period of 12 months, while non-regulated providers will offer up to 24 months. It’s expected that borrowers won’t hold onto the loan for too long, however paying it off earlier than the agreed-upon date is something else entirely.

Here, Octagon Capital answer some commonly asked questions around paying back a bridging loan early, as well as providing a deeper insight into how the bridging loan process works.


Will I Get Charged for Early Repayment?

You could potentially get charged by your lender for early repayment. This is known as an early exit penalty. Some lenders will charge this while others will not – check your loan agreement terms to see if you’ll have to pay this or not.




Borrowers can potentially save money on their interest payments for a bridging loan if they pay back early, as this is charged monthly for as long as it takes for full amount to be repaid. This is why bridging loan lenders may charge an early exit penalty, as they are losing money they would’ve otherwise received from you in interest if you were to have completed the loan to its full term.


Can I Get Out of a Bridging Loan?

You can only get out of the money owed from a bridging loan by paying what the lender is owed. This can be done via an early repayment of the loan, which, as previously mentioned, almost all lenders will offer.

In contrast to this, if you are unable to pay the loan back for the set repayment date, you can discuss refinancing options with your lender. While you might be able to arrange a more manageable payment plan with the lender when this issue occurs, you’ll still have to pay for the bridging loan you took out.

As a final resort, if a new payment plan can’t be worked out or the lender can’t get hold of you for some months, the property/valuable asset secured on the loan may be repossessed.


How Do Bridging Loans Work?

As the name suggests, bridging loans work by effectively “bridging” the gap between the purchase of one thing and the sale of another.

For example, if you’re looking to purchase a new house, but are waiting for the sale of your current home to go through, you can take out a bridging loan to help temporarily cover the cost of the new home.




Bridging loans are also great for development projects, enabling property developers to access hundreds of thousands or millions of pounds to cover the cost of their projects – with Octagon Capital, you can borrow from £50,000 to £25 million for up to 24 months.

As bridging loans are intended for short-term use, the loans are priced monthly instead of annually, borrowers having the option to pay their interest off each month as it’s charged, or “roll up” the repayments until the end of the loan term.

Below are some key features to expect with bridging loans from Octagon Capital:

  • Borrow a minimum of £50,000
  • Borrow a maximum of £25 million
  • Borrow for up to 24 months
  • LTV for regulated – 75%
  • LTV for non-regulated – 80%
  • Adverse credit histories considered


Open vs Closed Bridging Loans

The repayments for bridging loans can vary depending on whether you have a closed or open bridging loan.

A closed bridging loan is when the loan comes with a fixed repayment date. These types of bridging loans can typically be cheaper than open bridging loans, regarded as less risky. With a closed bridging loan, borrowers may still be able to pay the loan back early before the set repayment date.

An open bringing loan is when the loan does not come with a fixed repayment date. This helps give borrowers more freedom over their payment of the loan. With an open bridging loan, you’ll still have to have an exit strategy to ensure that the loan will be repaid.


What Happens if You Default on a Bridging Loan?

Failure to repay a bridging loan could lead to repossession of the property/valuable asset that was used as security, however this is only ever used as a last resort. In addition to this, borrowers can also face adverse costs as a consequence for not repaying.

Lenders can work with struggling borrowers and rearrange their loan repayments to something more manageable.

As a secured loan, bridging loans will need a valuable asset as security. This means that those with bad credit histories can be considered for this type of finance, however, it also means borrowers run the risk of losing their asset when failing to repay – which can often be their home.

With a bridging loan, as with any type of loan, it’s vital to ensure you are able to pay back the loan to avoid more costs and the potential repossession of your home.


I Can’t Pay Back My Bridging Loan – What Should I Do?

If you can’t pay back your bridging loan on the required repayment date, you should contact your lender as soon as possible.




Unfortunately, issues can arise that make it difficult to keep up with repayments – whether this is from cash flow issues, delays to your building project or something else. If these issues come up, it’s important to be honest with your lender, and let them know right away that you won’t be able to pay the loan on the set repayment date.

Your lender might be able to help you refinance or “re-bridge” under different terms, either with them or with a different lender. The solution worked out between you and your lender when struggling to repay your bridging loan will depend upon the details of the loan agreement and the situation you’re in that’s caused the repayment difficulties.


Will My Property Be Repossessed?

With Octagon Capital, your property will only be repossessed as a last resort. This means that if all other options have been exhausted, your property could be repossessed.

In addition to this, your property could also be repossessed if we can’t get in contact with you for a number of months. When struggling to repay, it’s best not to avoid your lender, as this can often leave them no choice to work with you on an alternative repayment plan, putting your property at greater risk of repossession.


How Do Bridging Loan Repayments Work?

Bridging loans are intended for short-term use, priced monthly rather than annually. Interest on the loan is charged for each month that the loan is open and can be paid monthly or all together at the end of the loan term.




The fees involved for a bridging loan can vary depending on the situation. Below is a list with some of the fees typical for this type of loan:

  • Interest rate
  • Arrangement fee
  • Legal fees
  • Broker fees
  • Exit fees
  • Valuation fees

It’s vital to understand the full cost of any potential loan before taking it out, ensuring that you’re able to keep up with the repayments and thereby avoiding the risk of costly consequences.


Can I Get Out of a Bridging Loan?

You can refinance if struggling to or being unable to pay your bridging loan. However, this does not mean you can avoid repayments of the money the lender is owed. Once you’ve made an agreement with your lender and have borrowed the money, you will have to pay for this loan.

When unable to pay your bridging loan, your lender can work with you to try and come up with a viable solution, making repayments on the loan more manageable.


Are Bridging Loans a Good Idea?

Bridging loans can be a great way of accessing the funds you need when you need them. They can be applied to various different situations, such as buying a new property while waiting for the sale of a current one, property development projects and more.




While bridging loans can be an effective aid for temporary cash flow issues, it’s important to only use them short-term, and be confident in your abilities to repay the loan back as and when required.


How Is a Bridging Loan Different to Mezzanine Finance?

Mezzanine finance requires borrowers to give up equity in their development project or business, whereas bridging finance is secured against property, and is used on a much shorter term. Both types of finance must also pay interest.

Both mezzanine and bridging loans can be a great to help borrowers in certain situations, carrying different levels of risk, eligibility criteria, repayment plans and more. But how precisely do they differ? And which one is best suited to certain situations and circumstances?

Here, Octagon Capital explores the differences between mezzanine finance and bridging loans, and which one works best in different situations and circumstances.


Mezzanine Finance vs Bridging Loan: Which One Is Right for Me?

Mezzanine finance is used more long-term than a bridging loan, requiring the borrower to give up equity either in their development project or business, while a bridging loan is used on a much shorter-term basis, securing a property against the loan while repaying after a few months (the maximum length of time you can take out a bridging loan with Octagon Capital being 24 months).


bridging loan coins


Mezzanine finance can appeal to lenders as they not only get paid interest back by the borrower, but also get shares, which could potentially be more valuable than a standard repayment by the borrower. Mezzanine finance has been designed to accommodate for ventures that are potentially riskier, with funding available for a range of borrowing periods – from a few months to 10 years.


Mezzanine vs Bridging Loan: Uses

A bridging loan can be used for a variety of different purposes, but essentially helps to “bridge” the financial gap for borrower’s between the purchase of a property and the sale or influx of money from somewhere else.

In comparison, a mezzanine loan is used when the borrower can’t afford the loan, or the opportunity is considered too high of a risk for other types of lending. Mezzanine finance can be used to top up an existing loan, to help fund a business project or to help grow a company. While it’s high-risk, the lender could potentially reap the rewards of enormous returns via the shares they’re given.


Mezzanine vs Bridging Loan: Eligibility Criteria

As mezzanine finance and bridging finance operate differently, the eligibility criteria for each type of loan will also differ greatly.

To obtain mezzanine finance through Octagon Capital, applicants will have to meet the following criteria:

  • Must offer equity of up to 20%
  • Must be based in the U.K., Scotland or Wales
  • Must be a limited company
  • Adverse credit histories considered
  • Both commercial and residential properties considered

Bridging finance in comparison will require applicants to meet the following eligibility criteria:

  • Minimum borrowing amount of £50,000
  • Must have an exit strategy
  • Residential, commercial, mixed properties and HMOs considered
  • Must be over 18
  • Must be based in U.K., Scotland or Wales
  • Adverse credit histories considered

These two types of finance operate differently and will therefore have differing requirements and expectations for eligible borrowers to meet.


Mezzanine vs Bridging Loan: Repayments

Mezzanine finance is paid through both investment/shares in the borrower’s company as well as in cash or PIK (payment-in-kind) interest. Bridging finance is paid either once a sale has gone through on a property or the borrower manages to refinance with something longer term.

The interest for bridging finance is charged per month, however, borrowers have the option to pay this back either monthly or to “roll up” these repayments and pay back the loan in full at the end of the loan term.


How To Find Mezzanine Finance with Octagon Capital

Octagon Capital are a U.K. licensed credit broker, working with a number of reputable mezzanine finance lenders.




We’ve worked on a big range of projects, and are able to advise you on how best to approach your borrowing needs.

To get started, simply call us on 0333 414 1491 or email us at, and speak to one of our dedicated team members to explore your options.


Can You Use a Bridging Loan for Deposit?

You can use a bridging loan for a deposit on a new home. Bridging loans are commonly used for this purpose, helping homeowners to bridge the gap between purchasing a new home and selling their current one. The loan can then be repaid once the current home has been sold.

Bridging loans are great for those who need to borrow for a short period of time. They can resolve temporary cash flow issues, enabling property developers to go ahead with a new project, help homeowners secure their dream home and more.

For homeowners in particular, bridging loans can be great when wanting to purchase a new property but restricted, waiting for the sale of their current home to fund the purchase of the new one.


What LTV Can I Can on a Bridging Loan?

You can get bridging loans at 70% LTV if regulated, and 75% if unregulated, however there are also some cases where you can get up to 100% LTV. As a type of secured lending, borrowers will have to have a property/valuable asset to be used as collateral on the bridging loan.




You will be able to borrow a certain LTV (loan to value) on your property’s equity, the precise percentage of this being dependent on a few different factors. This can include:

  • Your income
  • Your credit score
  • Your affordability
  • The amount you need to borrow

Speak to Octagon Capital on 0333 414 1491 to discuss bridging loans. With Octagon Capital, you can borrow from £50,000 to £25 million, with loan terms of up to 24 months and rates from 0.44% per month.


What Else Can a Bridging Loan Be Used For?

Bridging loans can accommodate for a range of different borrowing needs. As well as being used by homeowners wanting to purchase a new property before the sale of their current home goes through, these types of loans can also be useful for property developers looking to refurbish a property with the intention of selling it at a higher price.





Borrowers can also use a bridging loan to raise finance for investment opportunities. This type of loan is great for short-term use, helping with temporary cash flow issues, repayments able to be made either monthly or altogether at the end of the loan term.


Do Bridging Loans Require a Deposit?

Yes, bridging loans will typically require a deposit. This deposit is paid upfront and in a lump sum.

The amount borrowers will have to pay for the deposit will depend on various different details of their borrowing circumstances, including the following:

  • The amount wanting to be borrowed
  • The value of the property wanting to be purchased
  • The LTV (loan to value)

Deposits for a bridging loan will be a minimum of around 20% to 25%, and represents the proportion of the property that the borrower owns outright, while the LTV is the rest of the property the borrower pays off through the bridging loan.


What’s the Eligibility Criteria?

The eligibility criteria for a bridging loan with Octagon Capital includes:

  • Minimum borrowing amount of £50,000
  • Must be in the U.K., Scotland or Wales
  • Must have an exit strategy
  • Must be over 18
  • Bad credit considered
  • Residential, commercial, mixed properties and HMOs considered

With Octagon Capital, you can also find non status bridging loans, meaning the lender is willing to consider those with bad credit histories, as well as those with no proof of income, being interested instead in the value your property potentially has, and your plans with it.


Is a Bridging Loan Right for Me?

Bridging loans are a great way to borrow, provided you borrow for the right reason. A bridging loan is best used to temporarily bridge a financial gap, whether this is for purchasing a new house when waiting for your current home to sell, to help fund property development projects or more. If you need short-term access to funds for any of these reasons, it could be worth considering a bridging loan.




Octagon Capital are a London-based broker, who have partnered with SPF Short Term Finance to process all enquiries and provide a quality service. Make an enquiry with our team today by calling 0333 414 1491 or emailing us at


Can I Get a Bridging Loan on My House?

Yes, you can get a bridging loan on your current house. Most bridging loan providers will require property as security on the loan. They accept a range of different properties for this purpose, including residential, commercial, semi-commercial and land.

Bridging Loans are a great option to consider when in between a property sale and a property purchase, used to “bridge” the financial gap and help you move into a new property before selling your existing one.

These types of loans should only ever be used as a means of short-term finance, as if it takes a while to sell your current property, or the sale falls through completely, you could then be stuck with a substantial amount of secured debt.

Here, we’ll take your through the key features of bridging loans, including who they’re really for, eligibility criteria, the cost of the loan and more.


Who Are Bridging Loans For?




Bridging loans are a dynamic means of finance, and can be used effectively in a range of different situations, including the following:

  • Moving house
  • Property development projects
  • Raising Finance

When applying for a bridging loan, you’ll also have to meet the lender’s eligibility criteria. Some lenders will require applicants to have a good credit history, however others may be willing to consider those with adverse credit histories.


What’s the Criteria for a Bridging Loan?

Octagon Capital’s eligibility criteria includes:

  • Must be over 18
  • Available for residential, commercial, mixed properties and HMOs.
  • Must have an exit strategy
  • Available in U.K., Scotland and Wales
  • Minimum borrowing amount of £50,000

We can also offer non status bridging loans, meaning we can consider those with no proof of income and adverse credit histories. With these types of loans, we’ll be interested in the value your property could potentially have, and your plans for it. For these types of loans, you can help to build up your application with a plan of action, an exit strategy and an indication of costs.


What Can I Use a Bridging Loan For?

A bridging loan can be used for various different purposes…

When moving house, homeowners might want to purchase a new property before selling their existing one, worried that they’ll lose their new property by waiting too long on the sale of their current home. Bridging loans can be useful for these types of situations, giving homeowners access to the money they need so that they can purchase their new property before selling the old one. The loan is then repaid when the old property is sold.

Bridging loans can also be great for property development projects. If a property developer wants to refurbish a property to sell at a higher price, they can take out hundreds of thousands, or even millions of pounds via a bridging loan for this, with money able to be sent through quickly and efficiently.




Those wanting to raise finance for investment opportunities can also do this with the help of a bridging loan. For those already with one of these loans, or a mortgage, this is known as a first charge. You can then take out another one of these loans (known as a second charge) using any leftover equity you have.


How Much Do They Cost?

As bridging loans are only meant to be used for a short period of time, they’re priced monthly instead of annually. With this type of loan, you may find yourself facing monthly fees between 0.5% and 1.5%.

The precise fees will be dependent upon the property and the opportunity it offers, however, the typical fees you’ll see with a bridging loan include:

  • Arrangement fee
  • Interest rate
  • Legal fees
  • Valuation fees
  • Broker fees
  • Exit fees

Interest will be charged for each month the loan is open for. Borrowers can either decide to pay this back month-on-month, or also have the option to “roll up” these repayments, leaving this until the loan term end.


How Do I Get a Bridging Loan?

You can apply for a bridging loan with Octagon Capital. First, you’ll have to make an initial enquiry, either via the form on this page, sending an email to, or by calling us on 0333 414 1491.




Through this enquiry, you can tell us how much you need to borrow and for how long, as well as some details on the property in question, including your plans for it. During this discussion, we’ll be able to advise you on the next steps, and you could receive an Offer in Principle in a matter of hours.


Can I Get a Bridging Loan if I Am Self-Employed?

Yes, if you’re self-employed it’s possible for you to get a bridging loan. With more than 5 million people self-employed in the U.K., many of which have borrowing needs, for lenders it makes sense to accommodate to this group.

The affordability rules for bridging loans aren’t as strict as they are for mortgages, however, self-employed people applying for a bridging loan will have to prove their financial status with business accounts, as well as meeting other eligibility criteria in order to be approved for this type of loan.


Should I Get a Bridging Loan if I’m Self-Employed?

Bridging loans can be a great method of borrowing for those who are self-employed, useful for a variety of different funding requirements.

For example, if you’re self-employed and investing in redeveloping a property that was bought at auction and need to borrow a loan to help purchase the property within the allotted 28-day period.




Mortgages may take too long to be approved in time for this, whereas a bridging loan can come through in time to meet the purchase deadline. The bridging loan is then repaid once it’s “bridged” the financial gap.

Bridging loans are a short-term type of finance, and therefore not intended for long-term use, but rather for temporary issues with cash flow.


Will I Need Proof of Income for a Bridging Loan?

For self-employed applicants, lenders will typically need to see proof of financial status. This can be shown through business accounts, typically over the course of two years, however certain lenders may only need to review one year of such accounts if one year is all that’s available.

In addition to this, the lender might request to see copies of the applicant’s bank statements.

With bridging loans, lenders will be focused more so on the applicant’s exit strategy rather than their financial status. This exit strategy can therefore be more important for a self-employed person’s application than their income.

So long as the applicant meets all the necessary eligibility criteria, even when self-employed, they could be eligible for a bridging loan.


What’s the Eligibility Criteria?

Eligibility criteria for a bridging loan can include:

  • Minimum borrowing amount of £50,000
  • Available in U.K., Scotland and Wales
  • Must be over 18
  • Available for residential, commercial, mixed properties and HMOs
  • Must have an exit strategy

When borrowing money in any form, a general requirement that can be expected is for the applicant to have a good credit score. However, with bridging finance this isn’t always the case.




At Octagon Capital, we’re willing to take a view on applicants with adverse credit histories, and also those with no proof of income. These types of bridging loans are often referred to as “non status bridging loans” and offer flexibility for those who have struggled to access finance before for these very reasons.


How Much Does a Bridging Loan Cost?

With bridging loans, you can expect to see typical monthly fees of anything from 0.5% to 1.5%.

Bridging loans are priced monthly rather than annually, due to the fact that they’re only intended for temporary, short-term use.

The typical fees you could see when borrowing a bridging loan include the following:

  • Interest rate
  • Legal fees
  • Valuation fees
  • Arrangement fee
  • Broker fees
  • Exit fees

The exact fees will depend on your unique case – e.g., the property and the opportunity offered with it.

You can choose to pay the interest each month (the interest being charged per month), or “roll up” the repayments and pay the full amount due at the end of the loan term.

The precise details regarding the cost of your loan and the fees charged will vary depending on the lender you go with, your circumstances and therefore the application you submit.


Where Can I Get a Bridging Loan When Self-Employed

Start your bridging loan application today with Octagon Capital. Simply make an initial enquiry via the form on this page, send an email to, or call us on 0333 414 1491.

We offer non status bridging loans and are willing to consider those with no proof of income as well as those with adverse credit histories.


Can a Bridging Loan Be Extended?

Yes, borrowers can extend their bridging loan term for a few weeks or even months. However, whether this extension will be granted, and by how much, will depend upon the lender and the circumstances in which the borrower finds themselves needing an extension.

Due to the nature of a bridging loan, the borrower’s ability to repay the loan can be contingent on certain factors moving forward in their purchasing process. Some of these can unfortunately become delayed, which can have a chain reaction on other aspects of the project, meaning the borrower may be unable to repay their bridging loan by the date they initially thought they would be able to.


Can You Refinance a Bridging Loan?

Your lender may be willing to let you refinance your bridging loan. Lenders used to be hesitant in offering this option, however now there are lenders willing to offer this to those who need to extend the date for repayment.




There are various different issues that can impact when a borrower is able to repay their bridging loan, including delays to a building project, cash flow issues, or something else entirely. It’s important to be completely honest with your lender if you know you won’t be able to make the repayment by the expected date.

Your lender may be able to help you work out a solution that makes the repayment of the bridging loan more manageable.


How Long Can a Bridging Loan Last For?

The duration of bridging loans can vary, depending on the lender, your borrowing needs and the type of bridging loan you opt for. With Octagon Capital, you should expect to see the following loan durations:

  • Regulated companies – 12 months
  • Unregulated providers – 24 months

The way your repayments work can also vary depending on a range of different factors. As bridging loans are intended for short-term use, they’re priced monthly rather than annually. Borrowers can either pay the interest monthly or pay for it all along with the rest of the amount owed at the end of the loan term.


Difference Between an Open and Closed Bridging Loan

Put simply, an open bridging loan won’t have a set repayment date, whereas a closed bridging loan will. The way a borrower’s repayments work for a bridging loan will differ depending on whether they opt for an open or closed loan.




Open bridging loans are used by borrowers who are unsure exactly when they’ll be able to repay back the loan. This could be down to a number of different reasons, providing flexibility to the borrower on their repayment of the loan.

While this type of bridging loan offers flexibility to borrowers, they’re known to be more expensive as they’re more of a risk for the lender to agree to.

Closed bridging loans in contrast have a set, concrete repayment date in which the borrower needs to repay their loan back. These types of loans are great for borrowers who know exactly when they’ll have the funds to pay back the bridging loan and are often offered at lower interest rates than open bridging loans. Borrowers are also more likely to accept these types of loans over open bridging loans, however they offer less flexibility in repayments.


What Happens if I Can’t Repay My Bridging Loan?

If you’re unable to repay your bridging loan on the agreed upon date, you could face adverse costs, and as a last resort, repossession of your property/valuable asset. Repossession is typically only done once all other options have been exhausted.

If you’re struggling with your bridging loan and feel like you need an extension it’s important to let your lender know right away, and try to work with them to find a solution that works for both of you.

With Octagon Capital, you can borrow for up to 24 months, with adverse credit histories considered and a minimum borrowing amount of £50,000. Get in touch with our team today to discuss your bridging loan options.


Can I Get a Bridging Loan Without Security?

No, you cannot get an unsecured bridging loan. This type of finance is always provided on a secured basis, meaning you will need to have the appropriate asset to secure the loan.

The asset required can vary depending on the lender, your project, and the details of your application, which we’ll go into more detail about later on in this guide.


What Unsecured Bridging Loan Alternatives Are Available?

You can take out an unsecured loan, which does not require a valuable asset to be secured. If you’re unable to take out a secured loan due to a lack of property/asset, this type of finance may be a better option to consider.




You may be able to take out an unsecured loan over a short period of time. These types of loans can be arranged quickly, however, can have high interest rates.

With an unsecured loan, lenders may also rely on other details of your application to feel secure in who they’re lending to, such as the applicant’s credit score.

There’s a wide range of different loans available on the market that won’t require a valuable asset as security, catering to a range of different circumstances, borrowing amounts and periods. It’s important to understand exactly what you’re looking for in a loan, and what details you’d need accommodating for (e.g., an adverse credit history), to help you filter your search for the best loan without security.


Secured vs Unsecured Lending

Both types of loans have their own pros and cons, and the best fit for borrowers will be dependent upon their unique circumstances and requirements.

With a secured loan, borrowers may be able to borrow significantly larger amounts in comparison to personal, unsecured loans. Borrowing amounts for unsecured loans typically go up to around £25,000, whereas with Octagon Capital, the minimum amount you can apply for with a bridging loan is £50,000.

An unsecured loan will also often require applicants to hold a good credit score, helping to provide reassurance that they can keep up with repayments. It’s for this reason that secured loans can be seen as more accessible to those with adverse credit histories (provided you have a valuable asset to secure the loan with), available for those that don’t hold a perfect credit history with the property, reassuring the lender that the loan will be paid off.

However, by securing valuable assets like your home onto a loan, you could end up losing it if you can’t pay back the loan. This can be a big risk to take, so it’s important to only take out such a loan when you’re confident that you’ll be able to keep up with repayments.


Should I Consider a Secured Bridging Loan?

If you’ve got a valuable asset to secure on the loan and are confident that you’ll be able to pay it back in time, a secured bridging loan is worth considering.




A bridging loan can be used for a variety of different purposes, including the following:

  • To help you buy a new house
  • To help fund a property development project
  • To help raise finance

When in between the sale of your current house and the purchase of a new one, bridging finance can help “bridge” the gap between the two, lending you the funds to purchase the new property before the existing one has been sold. This can be great for those who are at risk of losing their dream home waiting around for their current property sale to go through.

Bridging loans can also be used to help fund property development projects. If a property developer wants to refurbish a property or block of flats to sell them for a higher price, they can help fund this via a bridging loan.

You can also use a bridging loan to raise finance for investment opportunities, for example, putting money into another property or a business. For those with an existing bridging loan or a mortgage (a first charge) with any equity left over, you can use this to take out another loan (a second charge), for such opportunities.


Am I Eligible for a Secured Bridging Loan on an Unmortgageable Property?

Yes, you can still be eligible for a bridging loan even if you’ve been refused by a mortgage lender.

The term “unmortgageable” is used for properties that mortgage lenders refuse to touch. This can be due to the lack of a kitchen, bathroom or for various other reasons.

Even if a property is unmortgageable, you may still be eligible for a bridging loan, and even use the funds from this loan to make the property habitable, and therefore able to later sell at a profit.

If you’re unsure about whether a bridging loan is right for you, get in touch with Octagon Capital to discuss your options.


Do I Need To Be Living in the Home To Get a Bridging Loan?

No, you do not need to be living in the property you’re using the bridging loan on in order to get one. Bridging loans are a secured form of lending, meaning the lenders require a valuable asset/property to secure the loan. The security typically used for this is the property you’re wanting to purchase/use the loan on.

Your borrowing facility will be based on the potential value of the property, as well as other details of your application (e.g., credit checking and affordability). The borrowing facility is also based off of whether the lender would be able to recover the debts if having to repossess the property, however, repossession of the property is usually only used as a last resort when the borrower defaults on their bridging loan.


Can I Take Out a Bridging Loan Without Security?

You cannot take out a bridging loan without security. Bridging loans are a type of secured lending, which requires a valuable asset as collateral in the event that the borrower cannot repay their loan.




While you can’t take out a bridging loan without security, there are a number of other loan options available where you don’t need to secure something to be approved for the loan.

An unsecured loan, as the name suggests, can be taken out without security, the lenders looking instead at other details of the prospective borrower’s application, including their credit history.

With an unsecured loan, you’ll also find the maximum amount you can borrow is significantly smaller than with a bridging loan – unsecured loans commonly offering up to £25,000, whereas bridging loans with Octagon Capital start at £50,000.

When looking to borrow money, it’s important to understand the lenders requirements as well as your own borrowing needs, and to explore loans you’re eligible for that can also accommodate to your circumstances.


Will I Need a Survey?

Yes, a bridging loan will be subject to a survey, helping the lender to ensure that the loan is safe to proceed with and isn’t too high of a risk.

As part of the survey process, a qualified surveyor will be sent to the property that is to be secured on the bridging loan. This surveyor will inspect the property for its value and provide a valuation once the inspection is complete.

Homeowners can often overvalue the property, which is why it’s important to get a valuation from someone qualified in assessing the true value of the property.


What’s the Eligibility Criteria?

The eligibility criteria for bridging loans through Octagon Capital is as follows:

  • Must be over 18
  • Must have an exit strategy in place
  • Property is subject to a valuation
  • Must be a minimum borrowing amount of £50,000
  • Bad credit considered
  • Available in U.K., Scotland, and Wales
  • Commercial, residential, mixed properties and HMOs considered

Bridging loan lenders are interested in how much value your property could potentially have, as well as your plans for it. Having a clear and concise exit strategy and plan of action will help you in getting your application approved.


Can I Take Out a Second Charge Bridging Loan?

Yes, you can take out a second charge bridging loan, however the lenders of second charge loans will typically need to get permission from the first charge lender for the loan to go ahead.




Bridging loan lenders will always add a “charge” to the property that’s being used as security, which establishes a priority of debts if the borrower becomes unable to repay their loan.

If it comes to the property being repossessed, the first charge lender would be paid first, then following this would be the second charge lender.


What Happens if I Can’t Repay My Bridging Loan?

If you can’t repay your bridging loan you should contact your provider right away and explain your situation. Often, your lender will work with you to try and come up with a manageable solution. It’s only usually as a last resort that your property will be repossessed.


What Are The Jobs Available at a Bridging Loans Provider?

The bridging loans industry is very fast growing, after all, the sector was worth £1 billion in 2011 and ten years later, it is estimated to be worth over £8 billion. With this comes many job opportunities and today, people may find more scope for working with a bridging loans provider or specialist lender, rather than working with a traditional bank or mortgage company. Below, Octagon Capital highlights some of the jobs and responsibilities you might find working with a bridging company.


  • Customer services advisor
  • Business development manager (BDM)
  • Underwriter
  • Marketing team
  • Legals
  • Mortgage administrator
  • Finance analysts and controllers
  • Compliance
  • HR
  • Directors


Customer services advisor

A bridging company will always have a team of people who oversee the customer service operations. This may include just answering standard queries from customers, answering the phones, offering initial quotes, following up enquiries and helping put key documents together.

Prior experience in the financial sector may be useful here, but a lot of the skills can be learned on the job. You will need people with good communication skills and confidence answering phone calls and dealing with queries or complaints. If you work in a regulated bridging environment, you will need to be more strict with following procedures and scripts, in line with regulation.

Whilst some bridging companies may have just one or a few customer service agents, you may find that it overlaps with other skills in administration or marketing. In some cases, you could always outsource this to specialist customer service centres such as Tieta or similar partners.


customer services


Business development manager (BDM)

A business development manager or BDM as it is commonly known is a sales role, with the responsibility to find new opportunities and bring in new business. A BDM would be good at speaking to new and existing partners, maintaining strong relationships with brokers that send regular deals and speaking to people at exhibitions and trade shows across the country.

Depending on the size of the firm, you may find that there are BDMs for specific regions, so that they can capture more of that specific market or become more well-known in that area. If they are on the road a lot and going from place to place, it might help if it is in the region of the South-West, or Midlands or a specific area.

BDMs will usually have a starting salary but may also work on commission and the successful completions of some deals.



The underwriters have a very important role within the organisation to assess the risk and rates of any customers and ultimately decide who is approved and who is not.

The underwriters will typically have a background in business, finance, law or economics and they will have very good analytical skills to assess risk and determine what rates are charged and what deals are approved - in order to make a profit.

Underwriters make key decisions and get the final say on who is accepted (along with the Directors).

The salaries for underwriters will typically be a lot higher, and this is something that you can learn by working in the organisation or you can study for this too. However, a lot of underwriters previously work in finance or law and have transferrable skills to take on this position.


Marketing team

The marketing team can be key for a bridging lender in order to convey a positive message and brand image. In a busy industry, a good marketing team can help the company stand out and generate good quality business.

A marketing department can be just one or multiple people and roles can include:

  • Branding
  • Brochures
  • Exhibitions and displays
  • Email and direct mail marketing
  • Website design and optimisation
  • Lead generation from online brokers
  • Affiliates, digital and online search
  • PR and press from local sources
  • Awards applications and submissions



The legal department will play a crucial role to ensure the completion of any deals, making sure all regulatory and legal contracts are viable, taking into consideration the complexities of purchasing properties or land. The legal team will be responsible to liaising with the solicitors of the clients, passing over funds and checking all aspects of the property and deal so they can run smoothly.

You will ideally need to have qualified solicitor and lawyers to work in the legal department of a bridging loans company - with other roles such as property surveyors likely to be outsourced to a partner.




Mortgage administrator

The administration team will be responsible for gathering and collecting documentation from clients and partners, staying on top of all regulatory requirements and helping to process bridging deals as smoothly as possible.

Since every company will be different, no prior experience may be required and much of this could be learnt on the job, whilst any background working in admin or financial services would be welcomed.


Finance analysts and controllers

The financial analysts and controllers will be responsible for holding and distributing funds between lenders, investors, solicitors and customers. A background in banking and finance would be useful for this, although some roles can be acquired on the job. Other roles may overlap with underwriting or even paying invoices for partners and staff members.



The compliance team may overlap with the legal department and will ensure that any activity is compliant and according to the regulation. To be compliant means that you will require written procedures for everything you do, including offering quotations, customer services, contracts, collections and more. A compliance team will be required to do regular training and also pass this on and teach this to other staff members in the organisation.



For larger bridging firms, there may be someone or multiple people involved in HR (human resources). Their roles will include hiring and firing staff, finding new candidates, deploying employee benefit schemes, arranging team socials, dealing with any internal conflict or mediation and also salary reviews.



Whether it is the main director or commercial director, these are the bosses who have an overview of the entire organisation and ultimately decide what direction it takes and how it grows.

The role of directors is important for securing larger bridging clients and also networking at the highest level. The responsibility of investment and where they generate their funding from will be a key role of a director.

Ultimately, directors will make the final decision on loan approvals, hiring of staff and the overall vision of the company.