Bridging loan calculator
A bridging loan charges interest monthly, not annually, because it is short-term. On a £200,000 loan at 0.85% a month over 12 months, the interest is about £20,400, and a 2% arrangement fee adds £4,000, before valuation, legal and exit costs. Interest can be serviced monthly, rolled up and paid at the end, or retained from the loan up front, which reduces the cash you receive. Bridging is fast but expensive, so a credible exit (a sale or a remortgage) matters as much as the rate.
How bridging is priced
Bridging finance is quoted as a monthly interest rate because it is designed to last months, not decades. The interest for the term is simply the monthly rate applied for the number of months, and on top sit the fees:
Interest = loan × monthly rate × months
Total cost ≈ interest + arrangement fee + valuation + legal + exit
Worked example
A £200,000 bridging loan at 0.85% a month for 12 months costs £1,700 a month in interest, about £20,400 over the year. A 2% arrangement fee adds £4,000, bringing the core cost to roughly £24,400 before valuation, legal and any exit fee. If the interest is retained, the lender holds that £20,400 back from the advance, so the cash you receive is lower than the gross loan.
Interest by monthly rate (£200,000, 12 months)
| Monthly rate | Interest a month | Interest over 12 months |
|---|---|---|
| 0.65% | £1,300 | £15,600 |
| 0.75% | £1,500 | £18,000 |
| 0.85% | £1,700 | £20,400 |
| 1% | £2,000 | £24,000 |
Interest only; excludes arrangement, valuation, legal and exit fees. Monthly rates shown are illustrative examples, not live quotes. Indicative only, not a quote or advice. Last reviewed 24 July 2026.
Check it for real
Run your own figures and get matched
The example above shows the method. Use this bridging calculator to run your own loan, rate and term, and if you choose, be introduced to a regulated broker who can check whether bridging is right and find a lender for your exit. Provided by our partner Propillo. Information, not advice, and no obligation.
Common questions
How is bridging loan interest charged?
Bridging interest is charged monthly, not annually, because the loan is short-term. A rate is quoted per month, for example 0.85% a month, and applied to the loan. There are three ways to pay it: serviced (you pay the interest each month), rolled up (it is added to the balance and settled at the end), or retained (the lender holds back the interest from the loan at the start). Rolled and retained mean you receive less cash up front.
What does a bridging loan cost in total?
More than the headline monthly rate. Expect the monthly interest, an arrangement fee of around 1% to 2% of the loan, a valuation fee, legal fees for both sides, and sometimes an exit or administration fee at the end. On a £200,000 loan at 0.85% a month over a year, the interest alone is about £20,400, and a 2% arrangement fee adds £4,000, before valuation and legals. Bridging is fast but expensive, so the exit plan matters as much as the rate.
What is the difference between gross and net loan?
The gross loan is the full amount secured, including any rolled or retained interest and fees. The net loan is the cash you actually receive. If interest is retained, the net can be noticeably lower than the gross. Lenders usually cap the gross loan at a percentage of the property value (often up to around 70% to 75%), so a high gross with retained interest can leave a smaller net advance than expected.
Is a bridging loan regulated?
It depends on the security. A bridging loan secured against a property you or an immediate family member lives in, or will live in, is a regulated mortgage contract under the FCA. Bridging secured purely for business or investment purposes, for example on a property you will not live in, is usually unregulated. The protections differ, so it matters which applies to your case. A broker will tell you which side of the line you are on.
Bridging is often used to buy before you sell, or at auction. If you are moving home, compare it with let-to-buy and porting your mortgage.
Founder, MortgageExplained
Adam spent nearly a decade as a mortgage adviser at Just Mortgages, with further experience in commercial finance. He is CeMAP and CF qualified. He built MortgageExplained to do one thing well: explain mortgages in plain English, then introduce you to a regulated broker when you are ready. Every page is written and reviewed by Adam.
Last reviewed: 24 July 2026