Open Bridge

An open bridging loan has no fixed repayment date. The borrower has a credible exit strategy but it is not yet contractually confirmed - for example, the plan is to sell a property but it has not yet exchanged contracts. Lenders typically allow up to 12-24 months for an open bridge, though the expectation is always that repayment occurs as early as possible.

Open bridges are more expensive than closed bridges, because the lender faces greater uncertainty about when they will be repaid. The rate differential can be meaningful - 0.1-0.3% per month more than an equivalent closed bridge. This difference compounds over the life of a longer facility.

Despite the higher cost, open bridges are frequently the only viable option when a property needs to be purchased quickly before a confirmed sale or mortgage can be arranged. The key is to have a realistic and evidenced plan for the exit and to monitor progress actively to repay the bridge as quickly as possible.

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