Closed bridging loans backed by an evidenced exit
A closed bridging loan is short-term property finance supported by a repayment event that is already established, such as an exchanged sale with an agreed completion date or a formal mortgage offer. It funds you now, ahead of the proceeds arriving.
Rates from 0.53% a month on qualifying cases, from £26,000, over 1 to 12 months. We assess your exit evidence and discuss the case with suitable lenders before recommending one.
On this page
The short version
- A closed bridge is supported by an established repayment event, most clearly an exchanged sale with an agreed completion date.
- Open and closed bridges both have a maturity date. The difference is how firmly the exit and its timing are evidenced.
- A sale agreed, a memorandum of sale or a mortgage DIP helps but isn't the same as exchanged contracts or a formal offer.
- Stronger exit evidence can improve lender appetite, but there's no automatic discount. Compare the total cost, not just the rate.
- Rates from 0.53% a month on qualifying cases, over 1 to 12 months.
- Even an exchanged sale can be delayed, so the term should allow for slippage.
Not sure if your exit counts as closed? Read the guide first: Open vs closed bridging loans: which one do you need?.
What is a closed bridging loan?
A closed bridging loan is short-term property finance supported by an identified repayment event with a sufficiently established date and documentary evidence. The clearest example is an exchanged property sale with an agreed completion date. Lenders assess the evidence individually, and terminology varies.
The lender takes a charge over property, usually a first charge, and lends against its value. Interest is normally retained at completion or rolled up to the end, so there are usually no monthly payments. The loan has a contractual maturity date, and the expected repayment event is how you meet it.
Documentary evidence supports an expected repayment date. It doesn't guarantee it. An exchanged sale can still be delayed or fail, and a formal mortgage offer has conditions to meet before the money is released. A closed exit also doesn't automatically mean a lower rate, higher leverage or a faster completion. Those depend on the whole case.
Closed versus open bridging loans
Both normally have a contractual maturity date. Open doesn't mean you can repay whenever you like. The difference is how firmly the repayment event and its timing are established at the start.
| Closed bridging loan | Open bridging loan | |
|---|---|---|
| Maturity date | Yes, usually set around the expected repayment event | Yes. Repayment is still due at maturity |
| Repayment event | Identified, with documents showing the amount and expected timing | Identified, with a credible and often documented plan, but the timing is less certain |
| Typical evidence | Exchanged contracts, a formal mortgage offer, executed agreements for other proceeds | Agent advice, memorandum of sale, decision in principle, a refinance plan |
| Term | Often 1 to 12 months, allowing for possible delay | Often longer, to give the exit time to happen |
| Pricing | Set case by case. Stronger evidence may improve lender appetite or terms, but there's no universal discount for a closed bridge | |
If the repayment event hasn't happened by maturity, you still have to repay, agree an extension or refinance, and default terms may apply. That's the same whether the loan was called open or closed.
Closed or open describes the exit. Regulated or unregulated depends mainly on who lives in the security property. A closed bridge can be either. See who can borrow below.
Assessing the exit before selecting a lender
Lenders treat the same evidence differently. One may accept a formal mortgage offer with conditions still outstanding, while another wants them satisfied first. Knowing this before you apply avoids paying for a valuation and legal work with a lender that doesn't fit.
Before we recommend a lender, we review:
- the transaction that needs funding and its deadline
- the property and any existing security, with redemption figures
- the net amount you need on completion
- the repayment source and how much it will produce
- the documents you hold and any outstanding conditions
- the funding date and the expected repayment date
- a sensible contingency, and how minimum interest affects the cost
- whether another structure, such as an open bridge, would suit better
We then hold discreet early discussions with selected lenders to establish their appetite and likely requirements. These discussions aren't an approval. Every loan is still subject to underwriting, valuation and legal due diligence, and we tell you clearly what remains outstanding.
What counts as exit evidence
The evidence that carries most weight depends on how the loan will be repaid.
| Repayment route | Stronger evidence | Still assessed |
|---|---|---|
| Property sale | Exchanged contract and solicitor confirmation of the completion arrangements | Conditions, buyer funding, chain dependencies and net proceeds after charges and costs |
| Mortgage refinance | Formal offer, current underwriting position and confirmation of outstanding conditions | Valuation, legal requirements, offer expiry, borrower changes and drawdown readiness |
| Other contractual proceeds | Executed documents showing entitlement, amount and expected payment | Conditions, counterparty risk, restrictions and payment timing |
Supports a closed exit
- Unconditional exchanged sale
- Concluded missives (Scotland)
- Formal mortgage offer, conditions understood
- Executed agreements for other proceeds
Helps, but not on its own
- Sale agreed or memorandum of sale
- Estate agent progress update
- Mortgage decision in principle
- Conditional contracts, options, reservations or sales subject to planning
Exchange of contracts is when a sale becomes binding in England and Wales. In Scotland it's when missives are concluded, and Northern Ireland has its own process. Lenders assess the evidence according to where the property is.
What closed bridging loans are used for
Buying before your sale completes
You've exchanged on a sale but need to complete a purchase first. The bridge is repaid from the sale proceeds. If you'll live in either property, it may be regulated.
Releasing capital ahead of a sale
A sale has exchanged with a long completion and you need some of the money sooner. The lender looks at the net proceeds after existing debt and costs.
A gap before a confirmed refinance
You hold a formal mortgage offer but need funds before it can be drawn. A bridge-to-let may reduce uncertainty, subject to the term loan's conditions.
Investment and commercial proceeds
Contractual proceeds from another sale or agreement, with the amount and timing documented. See commercial bridging.
At an auction the purchase deadline is fixed, but buying the property doesn't make the bridge closed. That depends on the repayment event. Refurbishment isn't ruled out, but outstanding works can add conditions and timing uncertainty. Development exit finance may or may not be cheaper than your existing facility, depending on its terms, the security and the leverage.
Closed bridging loan rates and costs
Rates start from 0.53% a month on qualifying cases. Many cases price above that, depending on leverage, the property, the borrower and the repayment evidence.
| Feature | Typical position | What moves it |
|---|---|---|
| Monthly rate | From 0.53% | Leverage, property type, borrower profile and exit evidence |
| Loan size | From £26,000 | Larger loans considered individually |
| Term | 1 to 12 months | The expected repayment date plus a realistic allowance for delay |
| Arrangement fee | Commonly 1% to 2% of the gross loan | Lender, loan size and complexity |
| Other costs | Valuation, legal fees, possibly exit or admin fees | Confirmed in writing before you proceed |
| Broker fee | No upfront Aura Capital fee | Any fee on completion is disclosed before you proceed |
Compare the total cost, not just the rate
On a short loan, fees and minimum interest can outweigh a small difference in rate. Here are three offers on the same £300,000 loan repaid after two months, each with a 2% arrangement fee and simple monthly interest.
| Offer A | Offer B | Offer C | |
|---|---|---|---|
| Monthly rate | 0.60% | 0.53% | 0.53% |
| Interest charged | £3,600 | £3,180 | £4,770 (3-month minimum) |
| Exit fee | None | £3,000 (1%) | None |
| Arrangement fee | £6,000 | £6,000 | £6,000 |
| Total of these costs | £9,600 | £12,180 | £10,770 |
Illustration only, not a quote. Excludes valuation, legal, broker and extension costs.
Allowing for completion delays
Completions slip for many reasons: conditions not yet met, chain problems, or a mortgage lender taking longer. Set the term around the expected repayment date, the delays that could reasonably happen and what extra time would cost.
Know the cost of extra months
Check the minimum interest period, whether interest accrues daily or monthly, and whether unused retained interest is refunded if you repay early.
Know the extension terms
Extensions are at the lender's discretion and usually cost a further fee, sometimes at a higher rate. Ask before you draw down.
Repayment is due at maturity
If the loan isn't repaid on time, default interest and fees can apply and the lender can enforce. A refinance bridge needs its own underwriting.
Raise it early
If a delay looks likely, tell the lender well before maturity. There are more options weeks ahead than days ahead.
Who can get a closed bridging loan?
Individuals, limited companies, SPVs and partnerships. Corporate borrowers are usually asked for director guarantees.
Adverse credit
Missed payments, defaults and CCJs are considered by some lenders. Telling us at the start helps us approach the right lenders and avoid unsuitable submissions. It doesn't change a lender's criteria, and if the exit is a refinance, your credit will matter to that lender too. See bad credit bridging loans.
If you or a close family member live, or will live, in the security property, the loan may be regulated by the FCA. Aura Capital is not FCA authorised and doesn't give regulated advice. Where a case is or may be regulated, we refer it to an FCA-authorised adviser, who will confirm any fee before you proceed. See regulated bridging loans.
How a closed bridge works
Timing depends on the valuation route, the legal work and the lender's requirements, and we confirm it for each case.
Initial assessment
We review the transaction, the property, the net amount needed, your exit evidence and the dates, and tell you whether it's likely to be treated as closed or open.
Lender discussions
We discuss the case with selected lenders, then explain the proposed route, the likely costs and what's still outstanding.
Valuation and legals
Once you proceed, the lender issues terms. Instructing the valuer and solicitors in parallel can save time once the case is ready and the costs are clear.
Completion
The lender checks the exit evidence, often with your solicitor, and releases funds once its conditions are met. We keep the maturity date in view.
We'll ask for contracts and offers after we've spoken, through a secure route. Please don't send documents through the enquiry form.
Recent Aura Capital transactions
Closed bridging loan FAQs
What is a closed bridging loan?
A closed bridging loan is short-term property finance supported by an identified repayment event with a sufficiently established date and documentary evidence. The clearest example is an exchanged property sale with an agreed completion date. Lenders assess the evidence individually, and terminology varies.
What is the difference between a closed and an open bridging loan?
Both normally have a contractual maturity date. On a closed bridge the repayment event and its timing are firmly evidenced. On an open bridge there's a credible repayment plan, often documented, but the timing is less firmly established.
Are closed bridging loans cheaper?
Not necessarily. Stronger exit evidence may improve lender appetite or terms, but there's no universal discount. Pricing depends on the property, leverage, borrower and lender, and the total cost also depends on fees and minimum interest.
Does an agreed sale count as a closed exit?
On its own, usually not. A memorandum of sale or agent's update helps, but doesn't commit the buyer. An unconditional exchange of contracts, or concluded missives in Scotland, is the clearest evidence for a sale exit.
Can a refinance be a closed exit?
It can, where it's sufficiently established. A formal mortgage offer with its conditions understood is much stronger than a decision in principle. Lenders look at the conditions, the offer expiry date and anything that could change before drawdown.
What rates are available?
From 0.53% a month on qualifying cases, subject to underwriting, valuation and legal due diligence. Many cases price above that, depending on leverage, the property, the borrower and the exit evidence.
What fees should I expect?
An arrangement fee, commonly 1% to 2% of the gross loan, plus valuation and legal costs, and sometimes exit or admin fees. Aura Capital doesn't charge an upfront broker fee. Any fee on completion is confirmed in writing before you proceed.
What happens if my sale or refinance is delayed?
The loan must still be repaid by its maturity date. Extensions are at the lender's discretion and usually cost a further fee, and a replacement loan needs its own underwriting. If it isn't repaid, default interest and enforcement can follow, so raise delays early.
Can I get a closed bridge with bad credit?
Some lenders consider adverse credit, depending on what it is, the property and the exit evidence. Telling us at the start helps us approach the right lenders. It doesn't change their criteria.
Are closed bridging loans regulated?
They can be. If you or a close family member live, or will live, in the security property, the loan may be regulated. Aura Capital doesn't give regulated advice and refers these cases to an FCA-authorised adviser.
Who wrote this page
Harry Baker
Harry holds an MSc in Real Estate & Finance from the University of Reading. He arranges bridging finance for investors, developers, businesses and homeowners across the UK.
Related bridging products
Each product page has its own criteria and rates.
Discuss your closed bridge
Tell us what needs funding, when, and how it will be repaid. We'll review your exit evidence and explain whether a closed bridge is likely to suit, before you commit to valuation or legal costs.
Your property may be repossessed if you do not keep up repayments on a loan secured on it. All figures are indicative and are not an offer of finance. Lending is subject to lender criteria, underwriting, valuation and legal due diligence. Aura Capital is a trading name of Chammosair Limited, registered in England & Wales, company no. 15786496. Aura Capital is a broker, not a lender, and is not authorised or regulated by the Financial Conduct Authority. We do not give regulated advice. Where a case is or may be regulated, we refer it to an FCA-authorised adviser.