Bridging loan
calculator.

01 / START WITH YOUR NUMBERS

How to use the bridging loan calculator

1. Start with the advance and security value

   The advance is the money borrowed before interest. The property value is used only to calculate initial loan to value. The tool does not include an existing mortgage or other secured borrowing.

2. Enter monthly pricing and the term

   Bridging interest is entered as a monthly rate, not an APR or annual rate. Choose the duration in months, then add arrangement and exit fee percentages and any other upfront costs.

3. Choose serviced or rolled-up interest

   Serviced mode pays interest every month. Rolled-up mode adds interest to the balance and compounds it monthly, with the whole accumulated amount due at redemption. Confirm that this matches the lender's actual approach.

02 / THE NUMBERS IN PRACTICE

A worked example

The illustration models a £250,000 advance against a £400,000 property, for 12 months at 0.75% monthly interest. It includes a 2% arrangement fee, 1% exit fee and £1,500 of other upfront costs, with compounded rolled-up interest.

03 / UNDERSTAND YOUR RESULT

Monthly servicing and rolling up are different cash flows

With serviced interest, the balance remains at the original advance and each month's interest is paid separately. Redemption includes the advance and exit fee. Those monthly interest payments still form part of the total cost even though they are not in the final redemption figure.

With compounded rolled-up interest, each month's interest increases the balance used for the next month. That creates interest on interest and can make the cost greater than simple monthly servicing at the same stated rate. Some real products use retained or non-compounding interest instead; this model does not reproduce those structures.

04 / UNDERSTAND YOUR RESULT

Allow for what happens if the exit is later

The duration cards show the difference between six, twelve and eighteen months at the same pricing. They assume the same monthly rate applies throughout. Extension fees, minimum-interest periods, default interest and changes to the facility are not included.

British Business Bank describes bridging as short-term finance and discusses the risks and use cases. A realistic exit plan is more than a calculator result. The tool does not assess whether a property sale or refinancing will happen on time or provide enough money to redeem the loan.

PLAIN ENGLISH, PLEASE

Bridging loan glossary

The terms behind the inputs and results, explained without the guesswork.

Advance

The opening amount borrowed, before accumulated interest and fees.

Serviced interest

Interest paid regularly rather than added to the outstanding balance.

Rolled-up interest

Interest left unpaid until redemption. This calculator compounds it monthly.

Redemption

The final amount due to clear the advance, accumulated interest where applicable and exit fee.

Arrangement fee

The entered percentage of the advance, assumed paid upfront.

Exit fee

The entered percentage of the original advance, added to the redemption payment.

Initial LTV

Advance divided by property value. It excludes rolled interest and any other secured debt.

BEHIND THE ESTIMATE

How the calculation works

Serviced interest equals advance × monthly rate × months. Compounded rolled interest equals advance × [(1 + monthly rate) raised to the number of months − 1]. Percentage inputs are divided by 100 before calculation.

Upfront costs are the arrangement percentage of advance plus other fees. The exit fee is calculated on the original advance. Total bridge cost includes all interest and fees. Redemption excludes upfront fees and serviced interest already paid, so those costs are not counted twice.