Bridging Loan Cost Calculator
Real all-in cost of a UK bridging loan — interest, arrangement fee, exit fee, compounded if you're rolling. Defaults to typical 2026 market terms.
How UK bridging loan costs are built
The sticker rate on a UK bridging loan is always a monthly rate (e.g. 0.75% pm). To annualise, multiply by 12 — so 0.75% pm is ~9% p.a. non-compounded. But the real all-in cost is more than that, and the "more" is where developers get caught.
1. Arrangement fee
Usually 1.5–2% of gross loan, charged at drawdown. Typically deducted from the facility (you receive net of the fee), though some lenders add it to the balance.
2. Interest style — rolled vs. serviced
Rolled-up interest accrues monthly and compounds. You pay nothing during the term and settle everything at exit. Simpler cash flow but more expensive.
Serviced interest is paid monthly from your cash flow. Cheaper overall (no compounding) but requires you to have ongoing liquidity.
3. Exit fee
0–1% of original loan at repayment, charged by some specialist lenders. Zero-exit-fee products have become the norm on mainstream regulated bridging.
4. Legal, valuation, broker fees
Not included in this calculator because they vary wildly. Budget £2,000–£5,000 combined on a sub-£1m residential bridge; more on commercial or complex legal.
Worked example
£500,000 bridge at 0.75% pm for 12 months, 2% arrangement, 0% exit, rolled:
- Arrangement fee: £10,000
- Rolled interest (12 months compounded at 0.75%): ~£46,863
- All-in cost: £56,863 — roughly 11.4% of the loan over the year.
Related
- LTGDV Calculator — for when you're sizing a loan against projected value rather than today's.
- Development Finance Calculator — if this is a build project, not a short-term bridge.
FAQ
How is bridging loan interest calculated?
Most UK bridging loans quote a monthly interest rate (e.g. 0.75% pm). Interest is usually calculated monthly on the outstanding balance. For rolled-up interest, the rate compounds each month and you pay it all at exit.
What is the typical arrangement fee for a bridging loan?
Arrangement fees in the UK are usually 1.5–2% of the gross loan, charged on drawdown and either deducted from the facility or added to it. Some lenders also charge an exit fee of 0–1% at repayment.
Are there cheaper alternatives to a bridging loan?
If you have time, a term loan or a development exit facility (for post-build sales period) is usually cheaper. If you don't, bridging is often the right tool — it's priced for speed, not for cost.
How long does a bridging loan take to arrange?
Fast-turnaround bridging can complete in 7–14 days, sometimes faster with a regulated lender and clean title. 3–5 weeks is more typical when legal DD and valuation are bundled in.