Regulated Bridging Loans

Bridging Finance 4 U can help you whether you are looking to find and arrange a competitive bridging finance solution for a commercial or a residential property transaction. Some types of bridging finance are regulated, and other types are not currently regulated by the Financial Services Authority.

A regulated Bridging Loan is defined as a bridging loan where :
  • A first charge is taken out over the property being used as security.
  • You or any family member use or intend to use at least 40% of the property as a dwelling (i.e. to live in).
Please note, the property or land you are actually purchasing may be for commercial / investment purposes, but if the property you are using for security of the loan is residential the bridging loan will be classed as regulated.

The Financial Services Authority (FSA) currently regulate residential mortgage advice and mortgage lending in the UK. i.e. the provision of a loan that is secured via a legal charge against a residential property, which either has at least 40% used or intended to be used for residential dwelling purposes.

Companies and individuals that wish to advise on or lend money for regulated mortgage contracts, including regulated bridging loans, must first be approved by the FSA. The FSA then maintain ongoing regulation of the activities of regulated mortgage advisers and lenders in the UK.

The FSA have 4 statutory objectives laid out in the Financial Services and Markets Act 2000 :
  • Market confidence – maintaining confidence in the UK financial system;
  • Financial stability – contributing to the protection and enhancement of stability of the UK financial system;
  • Consumer protection – securing the appropriate degree of protection for consumers; and
  • The reduction of financial crime – reducing the extent to which it is possible for a regulated business to be used for a purpose connected with financial crime.
As with any regulated mortgage, please pay attention to the following important risk warning :