Westminster Bridging Loan Calculator

Bridging finance involves several cost components beyond the headline interest rate. Understanding each element ensures you can accurately budget for your Westminster property transaction and avoid any unwelcome surprises at completion or redemption.

Monthly Interest

Monthly interest is the primary ongoing cost of a bridging loan and is calculated as a percentage of the outstanding loan balance. For Westminster properties, rates typically range from 0.55% to 1.2% per month depending on factors including LTV, property type, borrower experience, and the clarity of your exit strategy. Interest can be serviced monthly (paid as you go), retained (deducted from the loan advance upfront), or rolled up (added to the loan balance and paid at redemption). Retained and rolled-up interest structures are most common for short-term Westminster bridges, as they reduce the monthly cash-flow burden on the borrower.

Arrangement Fees

The arrangement fee, also known as the facility fee, is charged by the lender for setting up the loan. This is typically 2% of the gross loan amount for Westminster bridging transactions, although it can range from 1% to 2.5% depending on the lender and complexity. On a one-million-pound loan, a 2% arrangement fee equates to twenty thousand pounds. This fee is usually deducted from the loan advance at completion, so you do not need to fund it separately.

Exit Fees

Some lenders charge an exit fee when the bridging loan is redeemed, typically ranging from 1% to 1.5% of the loan amount. However, many lenders on our panel do not charge exit fees at all, and we actively seek exit-fee-free options for our Westminster clients. Always check whether an exit fee applies before committing to a facility.

Legal Costs

You will need to cover both your own solicitor's fees and the lender's legal costs. For Westminster bridging loans, combined legal fees typically range from three thousand to eight thousand pounds depending on the transaction complexity, the number of properties involved, and whether the title requires any remedial work. We can recommend experienced Central London property solicitors who regularly handle bridging completions on tight timescales.

Valuation Fees

An independent RICS valuation is required for all bridging loans. Valuation fees for Westminster properties typically range from one thousand to three thousand pounds, reflecting the higher property values in the borough. For properties above five million pounds, a more detailed valuation from a specialist surveyor may be required, increasing the cost. Desktop valuations are occasionally accepted for lower-risk, lower-LTV transactions, which can save both time and money.

Westminster-Specific Cost Considerations

Westminster property values are among the highest in the United Kingdom, which means the absolute cost of borrowing is naturally larger even when rates are competitive. A 0.65% monthly rate on a two-million-pound loan produces a monthly interest bill of thirteen thousand pounds, compared to just three thousand two hundred and fifty pounds on a five-hundred-thousand-pound loan at the same rate. However, higher-value Westminster properties often attract more competitive rates from specialist lenders due to the quality of the security and strong local demand. Prime Westminster postcodes such as SW1, W1, and W2 are particularly well-regarded by lenders. To discuss your specific circumstances, contact our Westminster specialists or explore our full range of bridging finance services.