A regulated bridging loan is a short-term finance facility secured against a residential property that the borrower (or a close family member) currently lives in or intends to occupy. In the UK, these loans are regulated by the Financial Conduct Authority (FCA) to protect consumers and ensure fair lending practices.
For property buyers in London, regulated bridging loans are most often used when purchasing a new home before selling the existing one, or when traditional mortgage finance cannot be arranged quickly enough.
Regulated bridging finance is suitable in situations such as:
Chain Breaks – Securing a new home before the sale of your current one.
Downsizing or Upsizing – Releasing equity while transitioning to a new London property.
Refinancing Delays – Covering temporary funding gaps until long-term finance is completed.
Inheritance & Probate – Accessing funds to settle inheritance obligations linked to residential property.
Regulated – Applies when the loan is secured against your primary residence (or family’s). Governed by FCA rules, offering consumer protections.
Unregulated – Typically applies to investment, development, or buy-to-let properties where the borrower will not live. These loans are more flexible but carry fewer consumer safeguards.
Understanding the distinction is crucial — regulated bridging is about residential need, while unregulated bridging is about investment opportunity.
Interest Rates – Usually 0.4% to 1.2% per month, higher than mortgages due to speed and short duration.
Fees – Arrangement fees (1–2%), valuation costs, and legal fees apply.
Loan Term – Typically 3 to 12 months for regulated cases.
Exit Strategy – Must be clear, usually through property sale or remortgage.
FCA Protection – Lenders must follow rules around affordability checks, transparency, and treating customers fairly.
Consumer Protection – Oversight by the FCA ensures fair lending practices.
Speed of Access – Funds can be released in days, not months.
Flexibility – Used for residential purchases where mortgages cannot complete on time.
Security for Homeowners – Provides a bridge between buying and selling without forcing rushed decisions.
At Fraser Bond, we help clients across London and the UK to:
Assess Suitability – Whether a regulated bridging loan is the right solution for your circumstances.
Application Packaging – Preparing compliant documentation to speed up approvals.
Access Trusted Lenders – Introducing borrowers to FCA-regulated bridging providers.
Exit Planning – Structuring repayment via sale or mortgage refinancing.
Compliance Guidance – Ensuring borrowers meet all regulatory and legal obligations.
Visit FraserBond.com to explore regulated bridging finance options tailored to your property goals.
