Equitable Charge Bridging Loans
An equitable charge bridging loan is a specialist short-term property loan secured against a property without registering a full legal charge at HM Land Registry like a normal mortgage. Instead, the lender takes security through contractual and legal documents (an equitable charge). This can allow faster access to capital, especially where a second charge bridging loan is not possible because the existing mortgage lender has refused consent.
Equitable charge bridging is most common for investment properties and is typically offered by specialist lenders rather than high-street banks. Maximum leverage is case dependent and usually assessed on combined loan-to-value (CLTV) - the total secured borrowing on the property.
Equitable charge bridging is usually used for urgent, complex, or high-value transactions - often where a second charge is not possible because the first mortgage lender has refused consent. It is a specialist structure, so lender availability is limited and the exit strategy must be clear.
What is an equitable charge?
An equitable charge is a way for a lender to take security over a property without registering a full legal charge at HM Land Registry (the way a normal mortgage is registered).
In simple terms, it means:
- You agree the property is security for the loan
- The lender has a contractual claim over the property’s value if the loan is not repaid
- The lender does not hold a registered legal mortgage on the title
Think of it as contractual security over the property, rather than a registered mortgage.
- Property value: £500,000
- Existing mortgage: £250,000
- Extra funds needed: £75,000
If a registered second charge is not practical, a lender may offer an equitable charge bridging loan to release funds quickly.
Why borrowers use equitable charge bridging
This type of bridging loan is usually used when a standard registered charge route is too slow, or not possible. Common reasons include:
Where a purchase, refinance or auction deadline is approaching and timing is critical.
Where the first mortgage lender will not allow a registered second charge.
Portfolio borrowers, structured ownerships, or situations needing a specialist legal approach.
To release funds quickly ahead of a refinance, sale, or other repayment event.
Where the title is already layered and a new registered charge route is not practical.
These facilities are usually provided by specialist lenders rather than high-street banks.
Equitable charge vs second charge bridging
Both options can help you raise funds without redeeming the first mortgage - but the structure is different.
| Feature | Second charge bridging | Equitable charge bridging |
|---|---|---|
| Registered at HM Land Registry | Yes | Usually no (may use a restriction/notice depending on lender) |
| Consent from first lender | Often required | Often used where consent is refused (subject to lender legals) |
| Speed | Can be slower | Can be faster in the right scenario |
| Enforcement route | More direct rights as a registered charge | Often requires court enforcement |
| Typical use | Standard behind-mortgage borrowing | Specialist, short-term lending where the normal route is blocked |
If you want us to sanity-check which route is realistic, send the first mortgage details, balance, property value, loan request and exit strategy.
What happens if the loan is not repaid?
If a borrower does not repay an equitable charge bridging loan, the lender can apply to court to enforce the charge. Depending on the situation, this may include forcing a sale of the property or converting the security into a registered legal charge.
- Legal action to enforce the equitable charge
- Possible court order for sale (depending on circumstances)
- In some cases, converting it into a registered legal charge
Because enforcement can be more complex than a registered legal charge, equitable charge loans can be priced higher. Lenders usually mitigate this with a strong exit strategy and conservative leverage.
Typical terms + costs
Equitable charge bridging is priced case-by-case. The main drivers are security quality, legal structure, leverage, loan size and exit strength. The figures below are general guides only.
- Term: often 3-18 months
- Leverage: often assessed on CLTV (total secured borrowing)
- Interest: retained, rolled, or serviced depending on the structure
- Borrower type: usually investment and typically unregulated
- Arrangement fee: may be added to the loan or deducted from the advance
- Admin fee: often deducted on completion
- Legal costs: can be higher where drafting is bespoke
- Valuation fee: depends on valuation route
We show the net figure you receive and any completion deductions clearly before you proceed.
Valuation methods available
Valuation route depends on the property type, leverage and lender requirements. Where speed matters, we aim to use the fastest viable route.
Automated valuation models may be possible on eligible standard properties where data confidence is strong.
See: AVM bridging loans.
A surveyor-led remote valuation where an inspection is not required.
More likely for complex properties, higher leverage, or where the lender needs maximum certainty.
FAQs
Quick answers to the questions customers commonly search for.
What is an equitable charge bridging loan?
An equitable charge bridging loan is a short-term property loan secured against a property without registering a full legal charge at HM Land Registry. The lender takes security through contractual and legal documents (an equitable charge) instead of a registered mortgage-style charge.
Why would someone use an equitable charge instead of a second charge?
It is commonly used when the first mortgage lender refuses consent for a second charge, or where speed and structure make a registered second charge impractical. It is a specialist solution and depends on lender and legal criteria.
How fast can an equitable charge bridging loan complete?
In the right scenario it can complete quickly, sometimes within days. Timing depends on legal complexity, clarity of title, valuation route, and how quickly KYC/AML requirements are completed.
Is an equitable charge legally binding?
Yes. It is a legally binding agreement that gives the lender security over the property. It is not the same as a registered legal charge, so enforcement may require court action.
Are equitable charge bridging loans more expensive?
They can be more expensive than standard bridging because the security structure is more specialist, fewer lenders offer it, and enforcement can be more complex than a registered legal charge.
What does CLTV mean?
CLTV means Combined Loan-to-Value. It is the total of all secured borrowing on the property (first mortgage plus any second/equitable lending) divided by the property value.
Our Case Studies
Discover how we’ve helped clients secure fast, flexible funding across acquisitions, refinances, and development deals.
