Bolton Business Finance arranges commercial bridging loans for limited companies and property investors buying, refinancing or raising money against commercial and semi-commercial property in the UK.
A commercial bridging loan is short term finance secured on a commercial property, used when a purchase or refinance has to complete faster than a commercial mortgage allows, or when the property will not yet support a mortgage at all. We are a whole of market broker with more than 50 bridging lenders on our panel and we arrange non-regulated, business-purpose bridging only.
Written by Marcus Wright, owner and founder of Bolton Business Finance Ltd, in financial services since 2008 and a commercial finance broker since 2019. Last reviewed September 2026.
On this page
- What a commercial bridging loan is
- What businesses use commercial bridging for
- How lenders value commercial property for bridging
- How much you can borrow and what it costs
- Regulated and unregulated bridging
- Which lenders offer commercial bridging
- How long it takes and what you need
- The exit
- Worked example: a town centre clinic conversion in Bolton
- Commercial bridging in Manchester and the North West
- FAQ
- Apply
The short version
- A commercial bridging loan is a short term loan of 1 to 36 months secured by a first or second charge on commercial or semi-commercial property.
- Lenders typically advance 65% to 70% of the value of commercial property, with 75% available from a small number of lenders on the strongest cases. Residential investment property attracts higher loan to values than commercial.
- Across our panel in September 2026, monthly interest rates for commercial bridging ranged from about 0.65% to 1.5%, with most cases between 0.75% and 1.05% a month. Interest is usually retained or rolled up rather than paid monthly.
- Loan sizes run from £25,000 to £50m and above. Completion takes two to four weeks on a clean case, and it can be faster where the legal work is simple.
- Every commercial bridging loan needs a credible exit, most often a sale or a refinance onto a commercial mortgage. Lenders underwrite the exit as hard as the property.
- A bridging loan secured on commercial property for business purposes is unregulated. Bolton Business Finance is not authorised by the FCA and arranges unregulated, business-purpose bridging only.
| Item | Typical position |
|---|---|
| Loan to value, commercial property | 65% to 70%, up to 75% with a few lenders |
| Loan to value, semi-commercial | Up to 75% |
| Loan to value, residential investment, for comparison | 75% as standard, 80% to 85% with some lenders |
| Loan size | £25,000 to £50m and above |
| Term | 1 to 36 months, 12 or 18 months is usual |
| Monthly rate, panel range | About 0.65% to 1.5% a month, most cases 0.75% to 1.05% |
| Arrangement fee | Usually 2% of the gross loan, sometimes 1% |
| Interest | Retained, rolled up or serviced monthly |
| Security | First charge, sometimes second charge, plus personal guarantee from directors |
| Exit | Sale, refinance to a commercial mortgage, or development finance |
| Regulation | Unregulated when secured on commercial property or for business purposes |
Figures are taken from our direct lender panel as at September 2026 and describe the spread across lenders, not a quote. Rates move monthly and the rate you are offered depends on the property, the loan to value and the exit. Bolton Business Finance Ltd is not authorised by the Financial Conduct Authority and arranges non-regulated, business-purpose finance only.
What a commercial bridging loan is
A commercial bridging loan is a short term, interest only loan secured against commercial property, repaid in one lump sum at the end of the term from a pre-agreed exit. It sits between the two things a business normally does with property: buying it and mortgaging it. A commercial mortgage takes three to six months to complete and the lender needs a property that is income producing or a business with trading accounts. A bridging lender needs neither. It lends against the value of the building and the strength of the plan to repay, which is why it can complete in weeks and why it costs more.
The property can be anything with a commercial use: a shop, an office, an industrial unit, a pub, a care home, land with planning, or a mixed use building with flats above a shop. It can be vacant, part let, in poor condition or mid conversion. The borrower is nearly always a limited company or an experienced investor, and the purpose is nearly always a business purpose, which is what takes the loan outside FCA regulation.
What businesses use commercial bridging for
Most commercial bridging loans we arrange fall into one of eight situations. The exit column matters more than the use column, because it is the exit that decides whether a lender will fund the case at all.
| Situation | Why bridging fits | Usual exit |
|---|---|---|
| Buying premises before a commercial mortgage can complete | A commercial mortgage takes 3 to 6 months. A vendor or a chain will not always wait. | Refinance onto a commercial mortgage once the purchase has completed and the property is occupied or let |
| Buying commercial property at auction | Auction contracts complete in 20 or 28 days. No mortgage lender works to that timetable. | Refinance or sale |
| Buying a vacant or run down building to bring back into use | Mortgage lenders want rent or trading income. An empty shop has neither until the work is done. | Commercial mortgage once let or trading. See refurbishment bridging |
| Raising working capital against commercial property you already own | Fast, secured and not dependent on trading accounts. This is what most people mean by a business bridging loan. | Refinance, sale of another asset, or repayment from business cash flow |
| Paying the VAT on a commercial property purchase | Where the seller has opted to tax, 20% VAT is due on completion and is reclaimed from HMRC weeks later. A short bridge covers the gap. | The VAT reclaim, typically within 90 days |
| Refinancing a facility that has expired or been called in | Buys time to sell or arrange a longer term loan without a forced sale. | Sale or refinance |
| Converting commercial property to residential | Funds the purchase and light works under permitted development before the units exist to mortgage. | Buy to let or multi-unit mortgage on completion. See commercial to residential conversion finance |
| Land and development exit | Land without planning cannot be mortgaged. A finished scheme can be bridged while units sell. | Planning gain and development finance, or unit sales. See land bridging and development finance for commercial property |
How lenders value commercial property for bridging
Bridging lenders lend against the lower of the purchase price and the valuation, and on commercial property the valuation figure they use is often not the open market value. That is the main reason commercial bridging loan to values are lower than residential ones, and it catches borrowers out more than the rate does.
A valuer will usually report three figures on a commercial building. The open market value assumes a normal marketing period. The 180 day value assumes the property has to be sold within six months, and the 90 day value assumes three. Many bridging lenders apply their loan to value to the 180 day figure, which on a secondary shop or an older office can sit 10% to 20% below open market value. A lender offering 70% of the 180 day value may be lending closer to 60% of what you paid. Vacant possession value is used where the building is empty or the lender is ignoring a tenant. Trading premises such as pubs, hotels and care homes are valued as a going concern, and a vacant version of the same building can be worth half as much, so the forced sale value is what a bridging lender is really looking at.
The practical answer to “how much can I borrow on commercial premises” is therefore 65% to 70% of whichever figure the lender adopts, and we tell clients to plan on the lower one. Where a case needs more, the usual routes are a second charge over another property the client owns, or a lender that works from open market value and prices for it.
How much you can borrow and what it costs
Bridging is quoted as a gross loan, and the money you receive is the net loan after the lender has deducted its arrangement fee and, in most cases, the interest for the full term or for a retention period. The difference is larger than people expect.
| Item | Amount |
|---|---|
| Property value | £500,000 |
| Gross loan at 70% | £350,000 |
| Arrangement fee at 2% | £7,000 |
| Interest retained, 12 months at 0.85% a month | £35,700 |
| Valuation, lender legal and admin fees, typical | £4,000 to £6,000 |
| Net loan released on day one | About £302,000 |
| Deposit and costs the borrower needs | About £198,000 plus stamp duty |
Illustration only, using a rate in the middle of our September 2026 panel range. Where interest is rolled up rather than retained, the net advance is higher on day one and the interest is added to the balance repaid at the end. Our bridging loan cost calculator runs these numbers for any loan, rate and term, and our commercial stamp duty calculator covers the tax, which cannot be borrowed against the property.
Three things move the rate. Loan to value is the biggest, with 55% to 60% cases priced well below 70% cases. The property type is next, with standard industrial and semi-commercial cheaper than trading assets or specialised buildings. The exit is third, with a sale to an exchanged buyer or a refinance already agreed in principle priced better than an exit that depends on a planning decision or a letting that has not yet happened.
Regulated and unregulated bridging
A bridging loan is regulated by the FCA when it is secured on a property the borrower or a family member lives in or intends to live in. A bridging loan secured on commercial property, or on an investment property the borrower will never occupy, or taken by a limited company for business purposes, is an unregulated mortgage contract. Almost every commercial bridging loan is unregulated for that reason.
What that means for the borrower is that the lender does not have to follow FCA mortgage conduct rules on affordability and advice, the offer letter will ask you to declare that the property is not and will not be your home, and you are expected to take your own legal advice. What it means for us is simpler. Bolton Business Finance is not authorised by the FCA, so unregulated business-purpose bridging is the only kind we arrange. We cannot help with a bridge on a home, and where a sole trader or a small partnership is borrowing we check the purpose and the security carefully before taking the case on, because some of those loans fall inside the regulated perimeter even when the property is commercial.
Which lenders offer commercial bridging and how we choose
More than 50 lenders on our panel will consider commercial bridging, but they divide into three groups with different appetites, and most cases only fit one of them.
| Lender type | Typical terms | What they take on |
|---|---|---|
| Bank owned and institutionally funded bridging lenders | Rates from about 0.65% to 0.85% a month. Commercial LTV to 65% or 70%. Loans from £100,000 to £30m and above. Terms to 24 months. | Straightforward commercial and semi-commercial with a clear refinance exit, experienced borrowers, good credit. Slower and more paperwork, but the cheapest money. |
| Specialist bridging lenders | Rates from about 0.75% to 1.05% a month. Commercial LTV to 70%, 75% on the strongest cases. Loans from £25,000 to £10m. Terms to 18 or 24 months. | The bulk of the market. Auction purchases, vacant units, refurbishment, adverse credit, first time commercial investors, second charges and cross charges over other property. |
| Private and family office funders | Rates from about 1% to 1.5% a month. LTV agreed case by case. Loans from £50,000 to £5m. Terms usually 12 months. | Cases that need a decision in days, unusual property types, land without planning, and borrowers with credit or structure issues the other two groups decline. |
Ranges are from our 2026 direct lender panel and describe lender groups, not products. Every lender prices the property, the loan to value and the exit separately.
How we choose the lender
We start with the exit, because a lender that does not believe the exit will decline regardless of the property. Then the property, which decides the valuation basis and the loan to value. Then the timetable, which rules out the slower lenders on an auction case. Only then do we look at rate. On most cases we approach two or three lenders at the same time so the client has a comparison and a fallback if the first valuation comes in short. A declined bridging application does not leave the same footprint as a declined mortgage, but a wasted valuation fee is real money, so we try to get the lender right first time.
How long it takes and what you need
A commercial bridging loan completes in two to four weeks on a clean case. Faster is possible where the title is simple, the valuer is available and both sets of solicitors move, but a week is the exception rather than the rule and we would rather say so than promise it.
- Indicative terms, usually within 24 hours of us having the property address, purchase price or value, loan required, borrower details and the exit
- Decision in principle and valuation instructed, one to three days. The valuation fee is paid up front and is the first real cost
- Valuation returned, five to ten working days for a standard commercial building, longer for a trading business needing a going concern report
- Formal offer and legals, one to two weeks. The lender’s solicitor and yours work in parallel. Title, searches or title insurance, the personal guarantee and, for a company, a debenture
- Completion. Funds released to your solicitor, net of the arrangement fee and any retained interest
The documents a lender will ask for are shorter than for a mortgage: proof of identity and address for each director, evidence of the deposit and where it came from, the company’s Companies House details, a schedule of any other property owned with mortgage balances, and written evidence of the exit, such as a mortgage agreement in principle, a sale memorandum or an agent’s letter. Trading accounts are only needed where the exit relies on the business.
The exit
Every bridging loan is repaid in one lump sum, and the lender’s whole decision rests on where that lump sum comes from. On a commercial bridge there are three realistic exits. A sale, either of the security property or another asset. A refinance onto a commercial mortgage, which needs the property let or trading and the borrower able to pass a mortgage lender’s underwriting at the end of the term. Or development finance, where the bridge has bought land or a building that a development lender will fund once planning is in place.
Two rules follow. First, the exit has to be more than a hope. A lender will want to see a mortgage agreement in principle, a track record of similar refinances, or comparable sales. Second, there should be a plan B. The default rate on a bridging loan is typically double the contractual rate, and an extension is not guaranteed by the lender, so a case that relies on a single lender saying yes in twelve months is exposed. The worked example below shows why that matters in practice.
Worked example: a town centre clinic conversion in Bolton
In 2022 we arranged a commercial bridging loan for a GP practice owner buying a former retail building in Bolton town centre through his property company. The plan was to convert the lower floors into a private clinic, to be occupied by his own practice, and the two upper floors into a pair of one-bedroom flats. The purchase price was around £200,000 and the conversion budget a further £200,000. The building was vacant, unmodernised and had no income, so no commercial mortgage lender would look at it.
| Item | Figure |
|---|---|
| Gross loan | £133,000, about 66% of the purchase price |
| Interest rate | 0.85% a month |
| Term | 12 months |
| Arrangement fee | 2%, £2,660 |
| Interest retained | Three months, £3,391.50, then £1,130.50 a month in advance |
| Other lender fees | £175 insurance and funds release |
| Net advance on completion | £126,773.50 |
| Security | First charge over the building, personal guarantee from the director |
| Regulation | Unregulated, investment property, company borrower |
| Exit | Refinance onto a commercial mortgage once the clinic was trading and the flats let |
The lender was a specialist bridging lender from the middle group in the table above. A bank funded bridging lender would not take a vacant, unconverted building for a first time commercial borrower, and a private funder would have cost 1% a month or more. The valuation raised one point worth knowing about: on an old building the reinstatement cost for insurance purposes came in far above the purchase price, which is normal and is nothing to do with what the property is worth, but it is a question clients ask.
The client redeemed the bridge from his own and inter-company funds while the works were finishing, ahead of the refinance. When the clinic and flats were nearing completion in late 2023, we went back to the market for the exit and secured an indicative £200,000 commercial mortgage from a challenger bank, first on a five year fixed rate and then on a two year fixed rate the client preferred, with an agreement in principle issued in February 2024. At final underwriting the bank reclassified the case from owner-occupier to property investment, which changed the pricing, and then stalled on the point that the company occupying the clinic had been trading for under two years. That is the risk we describe in the section above: a refinance exit that depends on one lender and on accounts that do not yet exist.
Because the client also needed to fund a second project, a new build clinic on land his company already owned, and could not wait for the bank, we placed a £75,000 unsecured business loan for the practice within a week, on a 12 month term with no arrangement fee, so the second build could start on time. The mortgage refinance was then re-approached with lenders that underwrite the property rather than the trading history. The lesson we took from the case, and the reason it is on this page, is that the bridge itself was the easy part. The exit is where the work is.
Commercial bridging in Manchester and the North West
We arrange commercial bridging loans for clients across the UK, and we meet clients face to face in Bolton, Manchester, Bury, Wigan, Blackburn, Preston and across Greater Manchester and Lancashire. For a commercial bridging loan in Manchester, or anywhere in the North West, see our commercial finance broker Manchester page for the areas we cover in person. For the wider product range see our bridging loans hub, or compare commercial bridging quotes.
Commercial bridging loan FAQ
How much can I borrow on a commercial bridging loan and what LTV do lenders offer on commercial premises?
Most lenders advance 65% to 70% of the value of commercial premises on a bridging loan, and a small number will go to 75% on the strongest cases. The figure is applied to the lower of purchase price and valuation, and many lenders use the 180 day or vacant possession value rather than open market value, which reduces the loan further. Semi-commercial property is usually funded to 75% and residential investment property to 75% or 80%.
How do lenders value a commercial property when deciding how much bridging finance to offer?
A valuer reports the open market value, a 180 day value assuming a six month sale, a 90 day value and, where relevant, a vacant possession value. Bridging lenders usually lend against the 180 day or vacant possession figure, which can be 10% to 20% below open market value on secondary commercial property. Trading premises such as pubs, hotels and care homes are valued as a going concern, and lenders look closely at what the empty building would fetch.
Can I get commercial bridging finance to convert offices into flats under permitted development?
Yes. Commercial bridging is the standard way to fund the purchase and light conversion of an office or shop into flats under Class MA permitted development, because the residential units do not exist to mortgage until the work is done. The lender advances against the commercial value on day one, often with a further tranche for works, and the exit is a buy to let or multi-unit mortgage on the finished flats or a sale.
Is a commercial bridging loan regulated by the FCA?
No. A bridging loan secured on commercial property, or on an investment property the borrower will never live in, or taken by a limited company for business purposes, is an unregulated mortgage contract and is not regulated by the FCA. Only bridging secured on the borrower’s own home or a home for a family member is regulated. Bolton Business Finance is not FCA authorised and arranges unregulated, business-purpose bridging only.
How quickly can a commercial bridging loan complete?
Two to four weeks is realistic for a straightforward commercial bridging loan. Indicative terms come back within a day, the valuation takes five to ten working days, and legal work takes one to two weeks. Auction purchases with a 28 day completion are routine. Completion in under a week is possible where title is simple and both solicitors are ready, but it should not be relied on.
What happens if I cannot repay a commercial bridging loan at the end of the term?
If the loan is not repaid by the end of the term the lender can charge its default rate, which is typically double the contractual rate, and can ultimately appoint a receiver and sell the property. Most lenders will consider an extension or a re-bridge where the exit is close and the loan to value still works, but they are not obliged to. That is why lenders and brokers spend so much time on the exit before the loan completes, and why a fallback exit matters.
Apply for a commercial bridging loan
Tell us about the property and the exit
Send us the address, the price or value, the loan you need and how it will be repaid, and we will come back with indicative terms from the lenders that fit, usually within 24 hours. Property secured deals carry a £495 upfront fee and 1% on completion.
About the author
Marcus Wright is the owner and founder of Bolton Business Finance Ltd. He has worked in financial services since 2008, beginning his career at Santander, and has been a commercial finance broker since March 2019.
He founded Bolton Business Finance in 2020 to give businesses access to the whole lending market rather than one bank’s own product range. The firm is a member of the National Association of Commercial Finance Brokers and works with a panel of 135+ lenders.
Marcus arranges commercial mortgages, bridging, development finance, business loans, asset finance, invoice finance and merchant cash advances. Call 0161 546 9128.
Bolton Business Finance Ltd is an independent commercial finance brokerage, not a lender. We are not authorised by the Financial Conduct Authority and can only complete non-regulated introductions. All lending is for business purposes only. Rates and figures on this page are illustrative panel ranges as at September 2026, not quotes. Registered address: Westgate House, 1 Westgate Avenue, Bolton, Greater Manchester, BL1 4RF. Company number 12495909.