What is a Bridging Loan? Complete Guidance

Have you ever faced a situation when you want to buy any property but are out of cash? Yeah! All of us face this sometime in our lives.

The bridging loan was introduced to fill that gap and let you buy your favourite properties you are interested in. If you aren’t familiar with this, stay tuned in today’s discussion; we will explore all about bridging. Let’s get it done!

What is Bridging Loan?

A bridging loan is a short-term loan that works as a financial bridge between you and your desired property. It is expanding daily because of its easy-to-approach kind of process and the availability of instant cash.

We devour our time while approaching the rest of the loans because of their old traditional loans. There are two options for you: you need instant cash or need it after a few months, and then you can choose accordingly.

For instant cash, nothing would be better than a bridging loan, and if you don’t need money instantly, you can approach the rest of the traditional loan processes.

Types of Bridging Loan

There are two types of bridging loans:

  • Close Bridging Loans
  • Open Bridging Loans

You will experience these two types of bridging loans while availing of their services and can choose any of them or discuss with your lender all of the terms and conditions.

Closed Bridging Loan

In a closed bridging loan, you will have a specific repayment period and must repay all the amounts within that period.

Most of the time, those who don’t want to get involved in a long repayment period choose this type of loan and repay on time to get rid of it. It could be optional for you to choose any type of bridging loan according to your ease. 

Open Bridging Loan

In an open bridging loan, your lender will not give you a specific time to repay, which is considered the borrower’s favourite repayment method.

It doesn’t mean you can take as much time as you want. Still, you must repay the open bridging loan within one or two years.

All of these terms and conditions will be decided by your lender, so whenever you are discussing them with your lender, you can also discuss your conditions and request them to make them flexible.

Only the right organisation like kuflink can make things easy for you by connecting the borrowers with the right lenders.    

If your lenders will find their payment secure because of your strong repayment and investment plans.

Bridging Loans Pros and Cons

All types of loans have their drawbacks along with their benifits, and the same is the case with bridging loans. Have a look!


  • You will have instant cash and will keep your business on track
  • Can borrow a huge amount of money
  • Short term loans
  • Easy to approach
  • Show any valuable asset and avail
  • All of the repayment methods will be flexible for you
  • Can discuss all of the terms and conditions directly with your lender for your convenience


  • In bridging loans, all lenders will ask for a valuable asset as their loan security; if you want to seek a bridging loan, you have to secure your property to have this loan. It is a security for the lender to secure a backup plan to recover his loss if the borrower cannot repay.
  • Higher interest rate
  • Fees for its registration

How to Get a Bridging Loan?

Approaching a bridging loan is just like a piece of cake; you must follow a few simple steps to get it done. To get a bridging loan, first, you need to find a trustworthy organisation to ensure that you have all the authentic lenders.

Then enrol yourself, and they will fix a meeting with any of their suitable lender. We suggest you make a complete investment plan before meeting your lender because they will surely ask for a complete root map of your investment and a repayment plan.

You can discuss the terms and conditions with them and request to make things more flexible. You will secure any of your valuable assets by having this loan; if you may not be able to repay the borrowed amount, then your borrower will be the new honour of your property.

Why Bridging Loans Charge High Interest?

As we mentioned earlier at the start of this conversation that it’s a short-term loan, so the lender charges a high-interest rate.

Another interesting fact is you can get 75% more than your valuable asset. It’s a peer-to-peer lending process where you can contact your lender directly.

After applying, within a few hours, the required cash will be in your hands, and you need to pay that high amount back within the given time.

That’s why the lender charges a high-interest rate to recover their amount before the given time. If the borrower could not pay the total amount, it would be compensated with that high interest.   


A bridging loan is considered one of the most preferable and reliable types of loan because of its ease of approach. You can have a loan from any other provider but may never have the required cash within a few hours.

First, analyse your business or repayment strategy so that you can repay the loan amount at the end because if you can’t, then your lender will be the new owner of your existing property.

Whenever you want to buy any of your favourite properties, and the old one isn’t getting sold, then you can avail of this loan service to fulfil your financial needs by securing any of your properties to get this loan. We hope this was a fruitful and worthwhile conversation for all of you.   

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