Mortgage guide
First charge and second charge bridging loans
How first and second legal charges affect security, lender priority and borrowing.
- Published
- 13 Apr 2026
- Last reviewed
- 11 Sep 2026
- Reading time
- 2 min
First charge and second charge bridging loans
First charge and second charge bridging loans
Bridging loans are categorised by the lender's legal charge position: the order in which lenders are repaid from a sale of the security.
First charge bridging loan. A first charge bridging loan is secured where no other lending exists on the property, or where the bridging lender repays and replaces the existing finance. The lender holds the primary legal charge. First charge loans are lower risk for lenders and may be priced more favourably than second charge facilities.
Second charge bridging loan. A second charge bridging loan sits behind an existing first charge mortgage, secured against the remaining equity. The first charge lender keeps priority and must usually consent. A second charge lets a borrower raise capital without disturbing a first mortgage that is on favourable terms, fixed at a low rate, or subject to early repayment charges. Borrowing is assessed on a combined loan-to-value (CLTV) basis: the first mortgage and the second charge together must fall within the lender's limit. Typical maximum CLTVs are around 75% on residential property, up to 80% on buy-to-let, and around 65% on commercial property, subject to asset type and exit strength. Where a second charge is secured against the borrower's main residence it is regulated by the Financial Conduct Authority (FCA); against buy-to-let or commercial property it is usually unregulated.
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Bridging Loan Criteria
For context, these are the wider product terms covered by this guide. Availability and eligibility depend on your circumstances and the lender.
| Criteria | Detail |
|---|---|
| Borrowers | Personal, limited company (Ltd co), LLP and offshore trusts, depending on the lender |
| Repayment type | Interest only or repayment |
| Term | Short term. The maximum term varies by lender; in our experience the minimum term is usually 1 month, and 3 months with some lenders |
| Experience | Not always required; it depends on the lender and the exit |
| Max applicants | Varies by lender |
| Valuation types | Automated valuation (AVM), Market Value 1 (MV1) yield based, market value (MV), 180-day or 90-day value, depending on the lender and how it labels the valuation basis |
| Regulated and unregulated | Yes, both: regulated where the borrower or a close family member lives, or will live, in the property |
| Credit searched | Usually, depending on the lender |
| Credit scored | Varies by lender; the decision rests mainly on the property and the exit |
For context, these are the wider product terms covered by this guide. Availability and eligibility depend on your circumstances and the lender.
| Loan to value | Rate |
|---|---|
| 65% LTV | 0.62% per month (2% lender fee) |
| 75% LTV | 0.72% per month (2% lender fee) |
| 85% LTV | 0.9% per month (2% lender fee) |
For context, these are the wider product terms covered by this guide. Availability and eligibility depend on your circumstances and the lender.
| Feature | Detail |
|---|---|
| Additional Security | 100%+ |
| Residential | 90% |
| Commercial | 75% |
| Land | 70% |
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Frequently asked questions
Are second charge mortgages a viable alternative to bridging loans?
Yes, second charge mortgages are a common alternative where a borrower has equity but wants to keep their existing mortgage. They offer longer terms, higher loan-to-income flexibility, and lower overall cost than bridging loans.
Can I get a second charge bridging loan for property refurbishment?
Yes, you can obtain a second charge bridging loan for property refurbishment, provided there is sufficient equity after the first mortgage. Lenders assess combined loan-to-value, the scope of works, and a clear exit strategy, typically a refinance or sale once refurbishment is completed.
Is a second charge better than a bridging loan in a divorce?
A second charge loan can fund a buy-out over a longer term while keeping the existing mortgage, which suits borrowers who can afford monthly payments. A bridge can suit a purchase when a remortgage or sale will follow within months.
How much do banks charge for a bridging loan?
Bridging loans typically charge monthly interest between 0.5% and 1.5%, plus arrangement fees of around 1 to 2% of the loan amount.
Do bridging loans have early repayment charges?
Bridging loans usually have no long early repayment charges, though some have minimum interest periods or exit fees. Buy to let fixed rates commonly carry early repayment charges during the fixed period.
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