Can I Refinance an Existing Bridging Loan?

In short, yes, it is often possible to refinance an existing bridging loan with a new one.

In the past, lenders tended to be unwilling to offer bridging loans to refinance a previous bridging loan. However, many lenders are now willing to consider this approach, often referred to as “re-bridging”.

If this is your goal, it is a good idea to use an independent bridging loan broker with whole of market access to make sure you get the best possible deal.

Reasons for Refinancing an Existing Bridging Loan

Re-bridging can be a vital financial lifeline for those who need to extend their borrowing for a variety of reasons.

Common examples of a situation where re-bridging might appropriate include:

• If you are renovating a property or using the bridging loan as development finance on any other kind of property project and unexpected delays will take your completion date beyond the loan term of the original bridge

  
  

• The original loan term was too optimistic

  
  

• Unexpected costs mean you need to borrow more to complete your project

  
  

• You haven’t secured a sale or mortgage yet on a property and need more time

  
  

Restrictions on Re-Bridging Bridging Finance

Different lenders have different requirements and restrictions for their bridging finance lending.

Although we can usually find an appropriate lender for most situations, there are some circumstances which may narrow your options.

These include:

• If you need to re-bridge a bridging loan for business use

• If you have had the original bridge for less than 6 months

• Some lenders will not want to refinance the entire amount of the original loan or let you increase the size of your borrowing

None of these make it impossible to find a bridging loan for re-bridging, but it does make it especially important to use an independent bridging loan broker with access to the whole of the market.

They will be able to quickly connect you with the right lenders for your circumstances, saving you time, money and stress.

2024 Bridging Market Update

The bridging market has had quite a transformation in the past few years. With rates starting at 0.55% per month, the costs aren’t dissimilar from those of a mortgage, and the combination of flexibility, quick turnaround time and less stringent eligibility criteria has led to bridging finance growing in popularity.

It’s now seen as a product in its own right instead of an expensive alternative to long-term finance.

Our finance brokers are seeing more repeat clients, particularly investors who have turned their attention to property flipping considering the slim profit margins the buy to let market has been seeing. HMO conversions have also grown in popularity amid more rigid rental legislation.

According to our team of advisers, a high volume of first-time borrowers already have an understanding of bridging loans before approaching us, showing that bridging is becoming more recognised in the industry.

As bridging finance becomes more mainstream, lenders are reviewing and reducing rates more frequently, offering more flexibility around costs.

Find The Best Deals to Refinance an Existing Bridging Loan

Are you interested in using a bridging loan to refinance an existing bridge? Hilo Finance can help you get the best deal available using our extensive contacts throughout the bridging finance industry.

Our highly experienced bridging loan brokers can help you quickly find the best deals on bridging finance currently available, so you can secure the borrowing you need to complete your property project.

How We Can Help

Here at Hilo Finance, we can help guide you through your available options.

Our team have specialist knowledge of the loan market with access to niche lenders you won't be able to approach yourself. 

They'll get a full understanding of your circumstances, give you expert advice on whether your application is viable, and help you with all the documentation and information a lender will require.

We have access to a large range of leading UK lenders, including many lenders which would not be available to borrowers directly. This means you will have more choice of finding the right lender for your case. 

Call us today on 0203 750 0305 to see how we can help, or book a free consultation.