Bridging Loan for an Extension

Fast, flexible and cost-effective property finance to fund extensions and other development projects.

Borrow from £50,000, from as low as 0.55% per month.

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Bridging Loan for an Extension

Building an extension can transform your home or investment property and significantly increase its value, but funding such a project can present challenges. Whether you're adding a new kitchen, a loft conversion, or a multi-storey extension, bridging loans offer a fast, flexible financial solution, especially when traditional finance like a remortgage is too slow or unsuitable.

Bridging finance allows you to access the equity in your property quickly, keeping your project on track without being held up by lengthy application processes or restrictive lender criteria.

  • Market-leading rates from 0.55% pm
  • Finance possible within 7 working days
  • LTVs up to 80%
  • "Heavy refurbishment" projects covered
  • Interest roll-up options available
  • Loans from £50,000
  • Advice from our CeMap certified bridging advisers

Bridging Case Studies

Low Cost Drawdown Bridging Loan for Development Exit | Case Study
Low Cost Drawdown Bridging Loan for Development Exit
Area
Kent
Capital Raised
£900k
Date
February 2025
Commercial Bridging Loan to Refinance Hotel Before Sale
Commercial Bridging Loan to Refinance London Hotel Before Sale
Area
London
Capital Raised
£13.8m
Date
January 2025
Resolving Complex Debt Issues with a Bridging Loan | Case Study
Resolving Complex Debt Issues with a Bridging Loan
Area
Romford
Capital Raised
£135k
Date
November 2024

See All Bridging Case Studies

Why Our Customers Trust Us

With expert guidance, exentension bridging loans can provide an essential, versatile, and cost-effective solution

Here are 3 reasons our clients trust our advice and service.

Market-Leading Rates

We provide access to market-leading rates for every client, thanks to our relationships with close to 100 bridging lenders.

bridging loans

Multi-Award-Winning Team

Our team of bridging advisers have over 40 years of experience and are qualified to the highest level. We're proud to have numerous customer service awards to our name.

bridging loans

Fully Independent

As an independent brokerage, we focus on your best interests when comparing finance: from costs and terms to speed of service.

Our Experts

Our dedicated bridging finance team are CeMAP qualified and have over 40 years of experience.

Meet The Team

Fergus Allen

Head of Bridging CeMAP

Mathew Phillips

Senior Finance Broker CeMAP

Paige Dumpleton

Finance Broker CeMAP

How We Work

1. Get a Customised Quote

Our bridging specialists will take a detailed look at your plan and provide a sense-check on whether it’s achievable, what the terms and cost estimates are, and if indeed bridging finance is the best route for you.

2. Secure A Decision in Principle

Within 24-48 hours, we should have your Decision in Principle secured from the lender. You can present this to estate agents and sellers to showcase your buying power. We can also speak to each party directly to strengthen your case.

3. Submit Your Application

When you’ve had your offer accepted, we’ll submit your application, and the valuation process and legal work can begin. We'll act as a mediator between all parties, making sure the deal is progressing as efficiently as possible and smoothing out any complexities along the way.

4. Finance Your Purchase

We will keep you updated and informed until you receive funds from the lender and your transaction is complete. And for any queries you have throughout the course of your loan, we’re always here to help.

Speak to a bridging specialist today

Make your property ambitions a reality and find out if bridging finance could work for you. We’ll guide you through the process and take care of the heavy lifting.

Book Appointment

Bridging Loan for an Extension

with Fergus Allen & Sam Hodgson

Last Updated: 03/07/2025

While options like a remortgage or a second-charge mortgage can be used to fund home improvements, they come with longer application times and strict affordability checks. A bridging loan is a short-term, specialist product designed to overcome these hurdles, making it the ideal solution in many extension scenarios.

Consider using bridging finance for your extension if:

  • You need funding quickly: A bridging loan can be arranged in as little as 5-7 working days, which is crucial if you need to pay contractors or purchase materials without delay.
  • Your project is extensive: Major works like large extensions are classed as "heavy refurbishment." Many high-street mortgage lenders are unwilling to lend for such projects until the work is complete, whereas bridging lenders specialise in this area.
  • You are in the middle of a fixed-rate mortgage: Remortgaging could trigger substantial Early Repayment Charges (ERCs). A bridging loan can provide the funds you need without disturbing your favourable mortgage deal.
  • You have a complex income structure: Bridging finance focuses on the property's value and your exit plan, not your income history. This is ideal for self-employed individuals or those with irregular earnings who may struggle with standard affordability tests.
  • You are waiting on other funds: If you plan to pay for the extension with an upcoming inheritance, bonus, or pension drawdown, a bridging loan can "bridge the gap," allowing you to start work immediately.

https://www.cliftonpf.co.uk/case-studies/bridging-loan-to-fund-extension-while-awaiting-tax-free-pension-drawdown/

The Process: Funding Your Extension with a Bridging Loan

Securing bridging finance for an extension is a structured process designed for efficiency. With a broker like Clifton Private Finance, the journey is straightforward:

1

Initial Planning & Consultation

You'll discuss your extension plans, budget, property value, and existing mortgage details with one of our specialist advisors. We will help you outline a clear plan and a viable exit strategy.

2

Application & Lender Matching

We package your application, highlighting its strengths, and present it to the most suitable lenders from our network—those who understand heavy refurbishment projects and offer competitive terms.

3

Valuation & Formal Offer

The lender will arrange a valuation of your property to confirm its current value and sometimes its projected value post-extension. Once satisfied, they will issue a formal loan offer.

4

Funds Released & Construction Begins

After legal checks are complete, the funds are released, allowing you to commence or continue your extension project without financial holds-ups.

5

Executing the Exit Strategy

As the project nears completion, we will help you action your exit plan—typically refinancing your property onto a new mortgage—to repay the bridging loan.

Key Criteria for an Extension Bridging Loan

Unlike a standard mortgage application, bridging lenders prioritise two core elements:

  • Security: The loan is secured against the equity in your property. Lenders will assess the current market value of your home and the value of your outstanding mortgage to determine the available equity. The higher your available equity, the lower the risk and the more you can potentially borrow.
  • A Credible Exit Strategy: This is the most critical part of the application. You must have a clear, realistic plan for how you will repay the bridging loan in full at the end of its term. The strength of your exit strategy directly influences a lender's willingness to approve the loan.

Because the focus is on security and exit, factors like your credit score and monthly income, while still considered, are less critical than in a mortgage application.

Common Exit Strategies for Extension Bridging Loans

For a home extension project, the exit strategy is almost always a remortgage.

Understanding Loan Amounts, Rates, and Terms

At Clifton Private Finance, we can arrange bespoke bridging finance tailored to your extension project:

  • Loan Amounts: From £50,000 up to £25m, depending on the scale of your project and available equity.
  • Loan-to-Value (LTV): Typically up to 80% of your property's value. In some cases, this can be higher if additional assets are used as security.
  • Interest Rates: Competitive market rates from 0.55% per month, with lower rates often available for loans over £1 million.
  • Interest Roll-Up: A key feature where you make no monthly interest payments. Instead, the interest is "rolled up" and paid in one go with the capital loan when you exit. This frees up your cash flow to focus entirely on the extension project.
  • Loan Term: Flexible terms from 3 months up to 36 months, providing ample time to complete the work and arrange your remortgage.

The Clifton Private Finance Advantage for Extension Funding

Navigating the specialist lending market for extension finance requires experience and established relationships. High-street banks rarely offer suitable products for significant renovation projects, which is why a specialist broker is essential.

Partnering with Clifton Private Finance means you have an expert team dedicated to securing the best possible funding package. We have strong links to private banks and specialist lenders who not only understand heavy refurbishment projects but also welcome applications from clients with complex needs. We handle the entire process, from initial planning to securing the funds and structuring the exit, ensuring your extension project is built on solid financial foundations.

If you're planning an extension and need a fast, flexible funding solution, contact our team of bridging specialists today.

Book Appointment

Frequently asked questions

You can find the most common questions asked about bridging loans below. If you have a question that isn't answered here, please email us at helpdesk@cliftonpf.co.uk

About Bridging loans

Here are some of the most common alternatives to bridging loans:

  • Second-charge mortgages
  • Remortgaging
  • Equity Release
  • Personal Loan
  • Savings or Family Support
  • Development Finance
  • Commercial Mortgages
  • Refurbishment Loans

We break down each of these other financing tools in our full guide to alternatives to bridging loans

While none of these options provide the flexibility, loan size and low interest rates that bridging loans do for property transactions, you may find they are more appropriate finance options for your specific situation.

No, there is no strict age limit for securing a bridging loan. 

Bridging loans are typically 12 months in duration, which means that there aren't age limits in place like there are for mortgages that can last for 25+ years. 

The main example where age may be an issue is if you plan to refinance your bridging loan with a standard mortgage. In which case, you'll need to be eligible for a standard mortgage to qualify for your bridging loan - and if you are approaching retirement age, this could be an issue and you may be rejected for a bridging loan.

However, we work with specialist equity release and lifetime mortgage lenders that can provide a Decision in Principle for later-life lending (if it's feasible) so that your bridging loan can be approved if it makes sense with your broader strategy. 

No high street banks currently offer bridging loans. Instead, bridging loans are provided by specialist short-term finance lenders.

At Clifton Private Finance, we are a whole of market brokerage that deals with multiple bridging loan lenders, and we act as an intermediary between clients and the lender ensuring the process is smooth and hassle-free, and making sure our clients are getting a good deal.

There are two types of bridging finance: regulated bridging loans and unregulated bridging loans.

It simply depends on the intended use of the property you're purchasing. 

When you or a family member intend to live in the property you’re purchasing with your bridging loan, you’ll need a regulated bridging loan.

If you're getting bridging finance on property that you or a family member will not be living in, or if it’s a commercial property, then you’ll need an unregulated bridging loan (commercial bridge loan). 

And if you intend to sell the property to repay your bridging loan (flipping the property) instead of refinancing or selling another property, you’ll get an unregulated bridge loan.

Regulated bridging loans are authorised and regulated by the FCA and are usually locked to a 12-month maximum term.  Unregulated bridging loans, meanwhile, can have extended periods of up to 36 months and are generally more flexible.

If you’re unsure, it’s best to speak to a qualified adviser to go over exactly what you need and find the best bridging loan for you.

Yes, bridging loans are generally considered safe provided they are used for suitable property transactions. Speaking to a bridging loan adviser is recommended if you're unsure about the risks and suitability of a bridging loan for your situation. 

Generally speaking, the main risk of a bridging loan is that if you cannot repay the loan, your property can be repossessed and sold to clear your debt.

For example, if you take out a bridging loan to buy a new property but your existing property fails to sell and you cannot recoup the funds, this could become a risk. However, bridging lenders always require their own valuations for any property involved in a bridging transaction to combat this.

Another example could be that you're unable to secure a mortgage to refinance your bridging loan. At Clifton, we make sure your remortgage plans are sound if this is your bridging loan exit strategy, and can even arrange your mortgage for you through our dedicated mortgage advice service on the other side to smooth the process.

Repayments

You cannot turn a bridging loan into a mortgage, but you can repay a bridging loan with a mortgage and effectively refinance it into a long-term arrangement. 

This is common when buying an unmortgageable property with a bridging loan, carrying out refurbishments, and then mortgaging it once it is wind and water-tight and a new valuation has been carried out. 

This is also common for properties bought at auction where a mortgage would be too slow to arrange, and so a bridging loan is used which is then replaced with a mortgage later.

A bridging loan exit strategy is simply the way in which you plan to repay your bridging loan. 

The most common exit strategies are selling an existing property, selling the property you're purchasing, refinancing with a mortgage, or a combination. 

Other more unique exit strategies can include selling a business, receiving a pending inheritance, or receiving a large tax rebate.

You do not pay monthly instalments towards the capital loan of your bridging loan. Some bridging loans require you to repay the interest accrued each month, but most lenders will actually give you the option to roll this up into the loan value, meaning you repay it with your lump sum at the end and have absolutely no monthly commitments. 

It's worth noting that as soon as you pay off most bridging loans, you stop accruing interest - so, the quicker you pay it off, the less expensive it will be, and there are typically no ERCs (early repayment charges).

If there is a purchase involved, bridging loans are paid from the lender to the lender’s solicitor, then to the client’s solicitor, and then to the seller’s solicitor - so, you as a client will not see the funds in your own account - similar to a mortgage.

If there is no purchase involved (for example, for a bridging loan for home improvements before selling), the funds go from the lender to the lender's solicitor, to the client’s solicitor, and then to the client's bank account. 

In terms of how bridging loans are repaid by you, they are repaid as a lump sum, either at the end of your term or during it. You can choose to either 'service' the interest, so pay the interest back monthly, or roll it up into the value of the loan to also pay this off as a lump sum along with the capital.

Deposits and terms

Regulated bridging loans (for residential properties) are typically 12 months, however, some non-regulated bridging loans for buy to lets and commercial properties can be up to 36 months. 

Some lenders are more flexible on term durations than others, and it can be a case-by-case basis as to whether you'll get approval for a longer loan term.

Almost all regulated bridging loans are short-term, and have a duration of 12 months.

Bridging loans are short-term by nature. However, there can be some flexibility on term length, particularly for unregulated bridging. For example, bridging for development projects, flipping properties, buy to let bridging loans and commercial bridging loans can all have longer terms up to 36 months. 

Some bridging loan lenders allow you to extend your term if at the end of 12 months your property hasn't sold or your alternative funding hasn't come through yet - however, this is down to the lender's discretion and there are no guarantees. It's important to be aware of the risks of bridging loans, and your property can be seized and sold to compensate for failure to repay. 

You can effectively secure a loan for 100% of a property value, but only if you have other property as security to keep your overall loan-to-value below 80%.

So, if you're getting a loan for 100% of a property value, you'll need another property in the background to secure it against. 

The easiest way to see if you're eligible is either to give us a call or use our bridging loan calculator that automatically calculates your LTV.

You don't necessarily need a deposit for a bridging loan in the traditional sense of cash reserves, but you do need security for your loan in the form of another property or asset to keep the loan-to-value below 80% at a maximum.

For example, if you're buying a £300k property with a £300k bridging loan, you'd need another property to secure the loan against along with the property you're buying, or else your loan to value would be 100%. 

Miscellaneous

Understanding the difference between net and gross calculations is essential when comparing deals from bridging loan lenders.

The calculation determines the maximum LTV (Loan-to-Value), how much you can borrow, and how much you will eventually repay.

Here’s the difference:

When calculating the net loan amount for bridging loans, the borrower deducts the loan costs and additional fees (such as the arrangement fee) from the total loan amount - this is known as net loan calculation.

Contrary to that, gross loan calculation is based on the loan amount the borrower can receive without deducting any costs or fees.

In brief, the gross loan calculation represents the total amount available to the borrower, while the net loan represents what the borrower ultimately receives after deductions.

Which calculation do lenders use for bridging loans?

A common complication arises when it comes to comparing bridging lenders, as different lenders advertise their bridging loan products differently. The upshot of this, is that it can become difficult to determine if a higher LTV (loan-to-value) represents the actual amount you could receive.

Lenders typically use a gross loan calculation when advertising or promoting their bridging loan products.

This is because the gross loan amount represents the maximum loan amount the borrower is eligible to receive, and can be used as a marketing tool to attract potential borrowers.

Nevertheless, the net loan calculation is used when negotiating an agreement, which is the amount the borrower will receive after deducting fees and other costs.

Borrowers are responsible for repaying this amount, and lenders will use that amount to determine repayment schedules and other loan terms.

How a broker can help with bridging loan calculations

A broker can assist with bridging loan calculations by providing clarity, expertise, negotiation skills, and a comparison of loan options to help you make more informed decisions.

A first charge bridging loan refers to a bridging loan that is the only charge against the property, i.e., there is no existing mortgage on that property.

A second charge bridging loan is when there is already a mortgage on the property that the bridging loan is being secured against. 

In the event of repossession, the 'first charge' has the legal right to be repaid first, before the 'second charge', which is why second charge loans can be slightly more expensive as they're a greater risk to lenders.

It is still entirely possible to secure a second-charge bridging loan and they are common within the industry. 

Yes, your bridging loan lender will require a new valuation to be carried out for all properties in your bridging loan transaction. 

In some cases, we can work with lenders that can facilitate a 'desk valuation', which is a valuation carried out online based on the local property market, images of the property and the specifications of the home - this can save a considerable amount in fees and speed up your application, but it's not always possible, especially for higher value properties. 

Yes, you can get a bridging loan with bad credit. 

While lenders will look at your credit score and factor it into your application, there is no requirement for regular loan servicing with a bridging loan, and so your income is not analysed and your credit score is significantly less important than with a mortgage. 

Using funds from a bridging loan to purchase a property puts you in a strong position as a buyer - similar to that of a cash buyer. 

Being a cash buyer is attractive to sellers because there is no onward chain requirement, and the funds are ready to go for the purchase.

Using a bridging loan also eliminates the need for the chain to complete, and puts you in a position where funds can be available in a matter of weeks for completion; effectively rendering you a cash buyer to prospective sellers.

Let us do all the hard work of finding the right bridging lender for your circumstances. We secure bridging finance for applications of all types, and we negotiate competitive lending to meet your needs and timescales.

Fergus Allen
Head of Bridging CeMAP

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