Deciding whether a bridging loan is the right option can be confusing, given the many costs involved. To help provide clarity, we offer a detailed bridging loan calculator that allows you to estimate your potential expenses.
This guide focuses on how to use our calculator to get an accurate picture of the interest, fees, and other charges you may incur.
We also provide an in-depth look at the criteria used in the calculator, how interest is calculated, and what inputs it requires from you.
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How Our Bridging Loan Calculator Works
Our bridging loan calculator allows you to input key details to estimate costs.
Here are the main input fields:
- Loan Amount Required – Enter the amount you wish to borrow.
- Term Length – Select your desired loan term from 1 to 24 months.
- Type of Security – Choose from commercial, land with planning, land without planning, or farmland.
- Amount of Properties – Select the number of properties to use as security from 1 to 6.
- Value of Property 1 – Enter the market value of the first property.
- Mortgage Balance for Property 1 – Enter any existing mortgage on Property 1.
- Retained Interest or Monthly – Choose to roll up interest or pay monthly.
- Early Redemption Month – If exiting early, enter the month you are likely to redeem.
With these inputs, the calculator estimates the interest, fees, loan-to-value ratio, and other costs of a bridging loan. You can adjust the inputs to model different scenarios and see how they affect your costs. This allows you to determine if a bridging loan is affordable based on your specific situation.
Key Outputs of the Bridging Loan Calculator
The bridging loan calculator provides several key outputs, including:
- Net Loan Amount – This is the amount you wish to borrow.
- Facility Fee – The lender’s fee is shown as a percentage of the net loan amount.
- Net Loan Amount and Facility Fee – The net loan and fee total.
- Monthly Interest Rate – The interest rate charged monthly.
- Average Monthly Interest – The estimated monthly interest cost.
- Full-Term Interest Amount – Total interest if the loan goes full term.
- Loan to Value (LTV) – The percentage of the property value being financed.
- Estimated Additional Costs – Projected legal fees, valuation fees, lender admin fee, redemption admin fee, and other charges.
- Loan Settlement Amounts – The estimated redemption amount at end of term and early settlement amounts.
How to Use Our Bridging Loan Calculator
Using our bridging loan calculator is simple. Just follow these steps:
- Enter your required loan amount and desired term length.
- Select property type(s) and enter market value(s).
- Input any existing mortgages and choose roll up or monthly interest.
- Add additional properties if using more than one for security.
- Review costs and adjust inputs to model different scenarios.
- Once satisfied, request a custom quote from us.
Benefits of Using a Bridging Loan Calculator
- Convenience: Easily accessible online, our calculator be used from the comfort of your home or office while you plan your next big project.
- Quick Results: Determine the cost of a Bridging Loan in just a few clicks.
- Customizable: Our calculator allows users to enter their own loan amount, interest rate, and loan term, enabling a personalized estimate.
- Comparison Tool: Bridging Loan Calculators can be used to compare different loan options, helping individuals and businesses choose the best option for their needs.
How the Calculator Estimates Bridging Loan Costs
Our bridging loan calculator provides realistic cost estimates by incorporating common lender interest rates, fees, and criteria. Here’s how it calculates your potential costs:
- Interest Rates – Uses typical market interest rates based on factors like loan-to-value ratio, loan amount, and property type.
- Fees – Estimates common lender arrangement fees, legal fees, and other charges based on loan size.
- Term Impact – Factors in whether you choose a shorter or longer loan term.
- Early Redemption – Adjusts costs if you plan to exit before full term.
- Property Values – Calculates loan-to-value ratio based on property valuations input.
- Additional Properties – Considers additional security properties and mortgages.
- Roll Up Interest – Compounds interest monthly when this option is chosen.
By accounting for these key bridging loan factors, the calculator can provide realistic cost illustrations tailored to your situation. This helps determine if a bridging loan is affordable.
Bridging Loan Monthly Interest Calculation
How is bridging loan interest calculated?
Below is a visual representation of what the monthly interest repayments could look like on a bridging loan, where the borrowing amount is £100,000:
|Typical Bridging Loan Interest Rate||Monthly Repayments|
Additional Fees Which the Bridging Loan Finance Calculator May Not Cover
- Lender Facility Fee
- Property Valuation Fees
- Legal Costs
- Administration Fees
- Exit Fees
- Broker Fees
No Obligation Bridging Loan Calculator Quotes
While our bridging loan calculator provides close estimates, to get exact pricing tailored to your specific circumstances, we recommend requesting a custom quote.
Our quotes come with no obligations and we work to find lender deals that maximize savings for you.
The key benefits of requesting a personalized quote include:
- Firm rates and fees based on your actual details.
- Access to lenders and pricing you may not find on your own.
- Expert guidance in choosing the optimal loan structure.
- Assurance you are getting the most competitive terms.
Even if you aren’t sure a bridging loan makes sense, request a quote – there’s no commitment needed to receive one. Comparing our quote to the calculator illustrates how close of an estimate the calculator provides.
Bridging Loan Calculator Interest Rates
The bridging loan calculator uses the following typical interest rates based on the loan-to-value ratio:
- Up to 55% LTV: 0.55% monthly interest
- 55% to 65% LTV: 0.65% monthly interest
- 65% to 70% LTV: 0.75% monthly interest
- 70% to 75% LTV: 0.80% monthly interest
These interest rates represent common rates many lenders charge for bridging loans. The rates increase incrementally for higher LTVs due to the higher risk of lending a greater percentage against the property value.
The calculator automatically applies the appropriate rate based on the LTV calculated from your input details. You can also manually override the rate in the calculator if you have been quoted a specific interest rate.
Having an understanding of the typical interest rate tiers helps you estimate your costs and determine if a bridging loan is affordable.
Fees Included in the Bridging Loan Calculator
In addition to interest costs, the bridging loan calculator estimates these common fees:
- Arrangement Fee – Calculates a lender’s fee as a percentage of the loan amount, typically 2%.
- Legal Fees – Estimates lender legal costs often charged for processing the loan.
- Valuation Fee – Approximates the property appraisal fee.
- Admin Fee – Models the lender’s standard admin charge, often around £295.
- Redemption Fee – Projects the lender’s fee for closing out the loan, usually £120.
- Telegraphic Transfer Fee – Small fee lenders charge for sending loan funds.
The estimates for these fees are based on typical costs charged across the bridging loan industry. The actual fees may vary by lender.
Understanding these costs provides a more complete picture. You can also manually override fees in the calculator if you have been quoted specific amounts.
How Interest is Calculated in the Bridging Loan Calculator
The bridging loan calculator uses the following approach to estimate your interest costs:
- Interest Rate Tiers – Applies rates from 0.55% to 0.80% monthly based on loan-to-value ratio.
- Monthly Compounding – When rolling up interest, compounds it monthly by adding to loan balance.
- Loan Balance Basis – Interest is calculated on outstanding gross loan balance each month.
- Term Length – Multiplies monthly interest by number of months in loan term.
- Early Redemption – If exiting early, stops interest accrual at month selected.
- Minimum 1 Month – Even if term is less than 1 month, 1 month of interest is charged.
This standardized methodology allows the calculator to provide realistic interest cost estimates. The compounding effect is factored in if you choose to roll up interest monthly.
Understanding how bridging loan interest is calculated enables you to make informed affordability assessments when considering this financing option.
Other Bridging Loan Calculator Options
While our calculator focuses on common bridging loan structures, we can also accommodate other situations:
- Bespoke Rates/Fees – We can override system rates/fees with custom values if you have been quoted specific figures.
- Larger Loans – We can run estimates on jumbo loans above £10 million.
- Longer Terms – Loans up to 24 months can be modeled.
- Property Types – Can factor in commercial, land, and farm collateral.
- Limited Credit – Alternative options for those with past credit challenges.
- Complex Loans – Flexibility for unique situations needing tailored solutions.
Even if your situation doesn’t fit one of the default options, we have the capability to adapt the calculator and still provide you with realistic terms. Contact us to discuss your specific needs.
Other Costs to Consider with the Bridging Loan Calculator
While the bridging loan calculator provides realistic estimates of the major fees and costs associated with a bridging loan, here are some additional expenses to keep in mind:
Legal fees: The calculator estimates typical lender legal fees, but you may incur additional solicitor fees for your own representation. Shop around for competitive solicitor rates.
Property appraisal fees: The calculator approximates common valuation fees, but larger/complex properties may require more in-depth surveys which can cost more.
Early exit penalties: Many lenders don’t impose penalties for paying off loans early, but some may charge exit fees so be aware.
Tax implications: Depending on your circumstances, you may need to account for stamp duty taxes or other charges when budgeting for a bridging loan.
Ongoing property costs: For any properties used as collateral, don’t forget to factor in maintenance, insurance, utilities and other ownership costs.
While the calculator provides a general overview of fees, make sure to account for any additional costs specific to your situation when determining if a bridging loan is affordable. We can provide a detailed breakdown of all costs in a custom quote.
Frequently Asked Questions About the Bridging Loan Calculator
How accurate are the calculator estimates?
The estimates are based on typical lender rates and fees so provide a realistic projection in most cases. Custom quotes will dial in exact figures.
What loan amounts can be modelled?
The calculator can estimate loans from £100,000 to £10 million. For larger loans, contact us for custom modeling.
What property types work with the calculator?
You can model residential, commercial, land, and farm property collateral. The calculator adjusts for different property risks.
Can I get an instant quote online?
Unfortunately we do not provide instant online quotes or approvals. However, you can request a free custom quote from us without obligation.
Does the calculator guarantee approval?
No, the calculator only provides cost estimates. Loan approval depends on full underwriting based on your specific situation.