Bridging loans are increasingly popular. Data from the Bridging & Development Lenders Association recorded shows that in 2025 approved bridging finance deals increased each quarter.
The average size of a bridging loan for the first quarter of 2025 was £540,000 – which was another increase.
With their popularity rising, we’re often asked whether borrowers need a deposit or whether they can access a 100% loan option. The answer to both is yes, but not in all circumstances.
We’ll take a deep dive into what you need to know about deposits and bridging loans.
What is the deposit for a bridging loan?
You will typically need a deposit of 25% to 40% of the property’s value for a bridging loan although there are some lenders who may be able to offer up to 75% depending on the property’s asking price.
It all hinges on the loan-to-value (LTV), just like mortgages. The LTV is the ratio of the loan to the property’s value, so, if you want to buy a property for £100,000 and you have a 10% deposit (£10,000), you will need a 90% LTV loan.
Because property developers and investors often have capital tied up in other properties, it makes bridging loans popular as they require smaller deposits.
Having equity in another property is also a factor that lenders will consider, that’s because it can occasionally be used as a deposit for a bridging loan.
What about commercial properties?
Commercial properties carry more risk than residential because they can be more difficult to sell. The latest data shows that commercial property transactions dropped in August 2025 – down 3% on the previous month.
As budget pressures continue for businesses, this makes commercial property an increasing risk for investors. As a result, the deposit for bridging loans for commercial buildings is higher at 30% to 40%
How is the deposit worked out?
There is no ‘one size fits all’ solution to deposits in much the same way as mortgages. It very much depends on your personal circumstances, some of the considerations lenders make include:
- Your background. As with any credit, the better your history and track record the more likely to you are to get better LTV options and preferential rates. As it is a bridging loan, your exit strategy is also a factor lenders will consider, they will also take your company’s size into account when deciding on the deposit you’ll need.
- Asset and project value. It’s not only your circumstances that make a difference. There’s also the property you’re buying and your plans for it that are taken into account.
- Loan terms and size. The terms of your loan also make a difference. For example, the duration of the loan and how much you’re borrowing, lower deposits often come with higher fees.
- Lender criteria. Your lender also has individual circumstances! Some have a higher appetite to risk than others. If you work with us at Steel River Bridging Finance, we can help you find the lender that matches your risk.
What about a 100% bridging loan?
It is rare, but there are some circumstances where you can borrow 100% of the property’s value. That means not needing any deposit. You’ll probably need to provide another property or asset as security, however, and the interest rate is likely to be higher than other bridging loans. Again, it all depends on the circumstances, however, generally, lenders only offer loans at 75% of the property’s value, meaning you need to find a deposit of 25%.
What to do next
If you would like to know more about bridging loans and deposits or have any other questions about bridging finance, you can contact our experienced team today.
Remember, your home could be at risk if you do not keep up repayments on a loan secured on your property
