Commercial finance and development
Commercial bridging finance
Fast legal work for short-term commercial bridging loans, covering the facility terms, the lender's solicitors, the security and your exit.
This work depends on the details, so our team prepares a quote for you, usually within one working day.
Bridging lenders release money only when every condition is met. A quick quote is not the same as quick funds, so ask your solicitor which conditions are still outstanding and who is responsible for each one.
Commercial bridging finance is a short-term loan secured on property, typically used when you need money faster than a bank can lend: to complete an auction purchase, buy before a sale elsewhere completes, fund a refurbishment or cover a gap until long-term finance is in place. Loans like this usually run for a matter of months, and the lender expects a clear plan for repaying them.
Property investors, developers and businesses borrowing against commercial or mixed-use property use this service. Speed matters, but so does detail. Bridging loans carry higher costs and leave little room for error, so your solicitor works quickly with the lender's solicitors to satisfy their requirements and makes sure you understand the cost of overrunning the term.
Your quote is tailored to the lender, the property and the deadline, and our team aims to send it within one working day. If you already have a completion date, put it at the top of your request.
What is involved
Bridging work is about speed without cutting corners, and several of these steps run at the same time:
- Day one: your solicitor reads the offer, notes the deadline and asks you for everything the lender's solicitors are likely to need, in one go.
- The cost of the loan: checking how interest is charged (monthly, rolled up and paid at the end, or retained from the advance), the arrangement and exit fees, default interest and what an extension would cost.
- The exit: making sure the documents reflect how you plan to repay, usually a sale or a refinance, and what evidence the lender wants now.
- The lender's list: the lender's solicitors send their requirements, and your solicitor clears them item by item, flagging anything that could hold up drawdown (the release of the loan).
- Title and searches: gathering the title and searches quickly, or using search insurance (cover for the risk of not having searches) where the lender accepts it.
- Signing: the charge over the property, any personal guarantees and, for a company, a debenture over its other assets. Guarantors usually see an independent solicitor before signing.
- Drawdown: the money is released, often on the same day as a linked purchase, and the lender's charge is registered, including at Companies House within 21 days for a company borrower.
- Exit day: on a sale or refinance, obtaining the redemption figure and repaying the bridge so the charge can be removed.
What the legal fee covers
- Going through the bridging offer with you, including fees and default terms
- Working through the lender's solicitors' requirements to the deadline
- Investigating the title and arranging searches or search insurance
- Preparing the charge, guarantee and any debenture for signature
- Coordinating drawdown with any linked purchase
- Making sure the lender's charge is registered on time
- Reporting to you on completion and the key dates in the loan
Costs you may see on top
- The bridging lender's solicitors' costs, normally charged to you
- The valuation fee and any re-inspection fees
- The lender's arrangement and exit fees and any broker's fee
- Search insurance premiums, where insurance is used instead of searches
- Advice for guarantors from a solicitor independent of the deal
- Fees for registering the lender's charge against the title
- Extension fees and default interest if the loan runs past its term
What to have ready
- The bridging offer or terms from the lender
- Your exit plan, with evidence such as a sale agreement or refinance offer
- Details of the property, including its title number and any existing loan
- Board minutes approving the loan, if a company is the borrower
- Passports or driving licences and proof of address for directors and guarantors
- For a purchase, the contract or the auction legal pack
- Evidence of where any money you are contributing comes from
How long it takes
Commercial bridging loans commonly complete in 2 to 6 weeks, and sometimes faster where the title is clean, searches are already available and everyone is ready to sign. The lender's solicitors, the valuation and guarantors' appointments for independent advice are the usual pinch points.
Telling your solicitor the deadline on day one, supplying documents in a single batch and having evidence of your exit ready all help. A very short deadline may be achievable, but no firm can commit to it until it has seen the title and the lender's requirements.
Things to watch for
- Work out the total cost, not just the monthly rate. Arrangement and exit fees, legal costs on both sides and retained interest add up, and default interest is often much higher than the standard rate.
- Make sure the exit is realistic. If your sale or refinance takes longer than planned, extension fees and default interest can build up quickly, so allow some slack in the loan term.
- Personal guarantees put your own assets at risk if the property does not cover the debt. Read the guarantee carefully and take independent advice before you sign.
- Check the leases and planning before relying on a refinance as your exit. A tenant with a break option or a missing consent can delay a long-term lender and leave you paying bridging rates for longer.
- Search insurance is not a shortcut to certainty. It can save time, but it does not reveal problems, and a buyer or long-term lender may still want full searches later.
Questions people ask
Why do I have to pay the lender's solicitors?
Bridging lenders almost always appoint their own solicitors to protect their interests, and the facility terms make the borrower responsible for those costs. Your own solicitor acts for you. The lender's legal fee is often deducted from the loan on completion, so ask for an estimate early and include it in your budget.
What is an exit strategy?
It is your plan for repaying the bridge, usually by selling the property, refinancing onto a longer-term loan or selling another asset. Lenders assess it before lending and may ask for evidence, such as an agent's valuation, a refinance agreement in principle or progress on planning. If the exit fails, you remain liable for the loan and any default interest.
How is bridging different from a commercial mortgage?
A bridge is designed for months rather than years, is arranged quickly and usually costs more, often with interest rolled up or retained rather than paid monthly. A commercial mortgage is slower to arrange and has more ongoing conditions, but is more affordable over the long term. Many borrowers use a bridge first and then refinance once the property is let, refurbished or has planning, which is covered on the commercial refinance page.
Can bridging fund an auction purchase?
Yes, and it is common, because completion is usually due within weeks of the auction. Arrange the bridge before you bid, ideally with the lender's solicitors having seen the legal pack, because the deposit is paid on the day and the contract is binding straight away. The purchase side is covered on the commercial auction page.
Who does the work
Your matter is handled by a law firm regulated by the Solicitors Regulation Authority, the Council for Licensed Conveyancers or CILEx Regulation, or in Northern Ireland by a solicitor regulated by the Law Society of Northern Ireland. At the moment the law firms on our panel act for property in England and Wales, so for property in Northern Ireland we tell you whether a firm can act for you before we pass your details to anyone. The firm confirms who will work on your file, their experience and its terms before you instruct it. How we choose our firms.