Q&A: What you need to know about Bridge-to-Let Finance

Q: What is Bridge-to-Let finance, and when should I consider using it?

A: Bridge-to-Let finance is a short-term loan designed for property investors who need to complete work on a property before transitioning to a long-term Buy-to-Let mortgage. You might consider using Bridge-to-Let finance when you need time to refurbish or modernise a property to increase its rental value or to meet necessary standards before letting it out.

Q: In what situations might Bridge-to-Let finance be necessary?

A: There are several scenarios where Bridge-to-Let finance can be useful, including:

• Securing the purchase of a property that requires repairs before it can be rented out.
• Refinancing an existing property that needs modernisation to add value or to comply with the Minimum Energy Efficiency Standard.
• Purchasing or refinancing a House of Multiple Occupation (HMO) that needs improvements to meet licensing requirements.
• Making necessary refurbishments to a property that otherwise wouldn’t qualify for a Buy-to-Let mortgage.

Once the property is ready to rent, you can repay the bridging loan and transition to a Buy-to-Let mortgage.

 

Q: What advantages does Bridge-to-Let finance offer?

A: Bridge-to-Let finance provides the security of planning your finance journey from the start, with flexibility built into the process. We also allow you to exit onto any Buy-to-Let mortgage without a penalty fee, even if it’s not with us. Other lenders might require both the bridge and Buy-to-Let mortgages to be agreed upon with them from the outset.

 

Q: What security will I need to provide for a Bridge-to-Let mortgage?

A: Security for a Bridge-to-Let mortgage typically involves a first charge over the property, with most lenders offering up to 75% of the property’s market value. At LendInvest we offer up to 85% LTV on our refurbishment bridge. If you’re investing through a limited company, personal guarantees may also be required. Additionally, title insurance might be requested as a safeguard, protecting the lender against any legal issues with the property’s ownership. While you likely won’t need to provide a charge over your family home, it’s important to remember that a personal guarantee is a promise to pay.

 

Q: What costs are associated with a Bridge-to-Let mortgage?

A: The cost of a Bridge-to-Let mortgage varies based on factors such as your credit history and the loan-to-value (LTV) ratio. In addition to interest rates, which depend on your specific situation, you should budget for an arrangement fee of around 2% and legal costs to secure the loan. Be aware of any additional fees, such as early-exit charges, that may apply.

 

Q: What are the key benefits of a Bridge-to-Let mortgage with LendInvest?

A:

• Seamless Management: Handle both your Bridge and Buy-to-Let mortgages effortlessly in one place through our intuitive Mortgages Portal.
• No legal or valuation fees: At the Buy-to-let stage, enjoy significant savings with zero legal fees and no valuation fees, making your investment journey more cost-effective from the start.
• More options: You can use the GDV value once works are carried out when refinancing onto the Buy-to-Let
• Rate Flexibility: Choose from our competitive rates at the time of application, giving you the advantage of securing the best deal when you need it.
• Total Freedom: Experience complete flexibility with no obligation to lock into our Buy-to-Let products from day one—your choices remain entirely in your hands.
• More options: Transition to Buy-to-let on your HMO and Refurbishment projects is available
• Increased Broker Earnings: Brokers benefit twice with two procuration fees, maximising their earnings and rewarding their efforts.

LendInvest’s Bridge-to-Let mortgage isn’t just about financing—it’s about empowering your property journey with the tools, flexibility, and support you need to succeed.

 

Discover more about Bridge-to-let with LendInvest