What You Need to Know
As interest rates remain high in 2025, many property investors and business owners are questioning whether bridging finance still makes sense. The truth? Bridging loans continue to offer value, especially when used strategically and with a clear exit plan.
In this blog, we explore how bridging finance fits into today’s high-interest environment, what risks and opportunities to consider, and how Cotterell & Cotterell can help you navigate short-term borrowing with confidence.
Why Interest Rates Matter in Bridging Finance
Bridging loans are typically more expensive than standard mortgages because they’re short-term, fast to arrange, and designed for time-sensitive situations. In a high-interest market, these costs are higher, but that doesn’t mean they’re not worth it.
The key is to assess the cost in relation to the opportunity. For example:
- Securing a below-market property deal
- Avoiding chain breaks
- Funding a quick renovation ahead of resale
Situations Where Bridging Still Works
Even with higher rates, bridging loans remain effective for:
- Auction purchases
- Urgent refinancing needs
- Property chain rescue
- Light refurbishments and resale
- Capital raising for business growth
If the return on your project outweighs the interest cost, bridging finance remains a valuable tool.
How to Strengthen Your Application
In 2025, lenders are being selective. To secure bridging finance at the best terms, you’ll need:
- A clear and realistic exit strategy (e.g., sale, refinance)
- Solid property valuation
- Good credit profile and track record
- A trusted broker who can present your case clearly
Working with a specialist like Cotterell & Cotterell can make a big difference in how lenders respond.
What to Watch Out For
-
Shorter terms: Many lenders now prefer 6–9 month terms
-
Higher fees: Expect to budget for arrangement and exit fees
-
Stress testing: Lenders want to see that your exit plan holds up, even if rates stay high
Bridging isn’t right for everyone, but in the right hands, it remains a smart solution for urgent funding.
How can we help?
We help investors and businesses assess when bridging finance is the right fit and guide them through structuring a deal that works, even in a tougher lending climate.
Our lender network, hands-on support, and honest advice help you make the most of every opportunity.
📞 Ready to grow your business in 2025? Let’s talk.