Bridging Loan Interest Rates in Australia
Bridging loan interest rates in Australia currently start from around 7.49% p.a. for consumer facilities and 8.5% p.a. for commercial, with development facilities typically priced from 9% to 11% p.a. Your actual rate depends on the loan-to-value ratio, the property security, the loan purpose and how clearly your exit is evidenced.
In short: bridging is short-term, asset-based lending, so it prices above a standard mortgage but for a fraction of the time. Over a six month term the difference between a good rate and a poor one is often smaller than the fixed fees, which is why the total dollar cost matters more than the headline percentage. Model your own numbers with the bridging loan calculator. If you are new to the product, start with how bridging loans work in Australia or the bridging loans overview.
Current bridging loan interest rates
Indicative starting rates through our lender panel:
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Consumer bridging loans: from 7.49% p.a. Typical term 6 to 12 months. Maximum LVR up to around 75%.
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Commercial bridging loans: from 8.5% p.a. Typical term 6 to 12 months. Maximum LVR up to around 70% to 75%.
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Development bridging loans: from 9% to 11% p.a. Typical term 6 to 18 months. Maximum LVR up to around 65% to 70%.
LVR is assessed against the security address, and some funders will consider up to 85% depending on the scenario. Every bridging loan is priced individually, so the final rate reflects the risk profile of the specific transaction.
Rates last reviewed 6 August 2026. Indicative starting rates only, subject to lender assessment and approval, and subject to change without notice.
What is the average bridging loan interest rate in Australia?
Across the Australian specialist and private lending market, bridging loan interest rates generally range between 7.49% and 12% p.a. depending on how the facility is structured.
Typical ranges by purpose:
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Consumer bridging loans: 7.49% to 9% p.a.
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Investment bridging loans: 8.5% to 10% p.a.
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Development bridging loans: 9% to 12% p.a.
Borrowers with lower LVRs, prime residential security and a contracted exit consistently receive the most competitive pricing. Those three factors move the rate more than anything else.
What affects your bridging loan rate?
Loan-to-value ratio
The largest single driver. Lower LVR means lower lender risk and better pricing. Most bridging facilities are structured up to 65% to 75% LVR depending on the security. A borrower at 55% will be priced materially better than one at 75%.
Exit strategy
The clearer and better evidenced your exit, the better your terms. A signed contract of sale with a settlement date is a stronger exit than an unlisted property with an appraisal. See bridging loan exit strategies.
Property type and location
Prime metropolitan residential security attracts the most competitive pricing because it is the most liquid. Commercial property, development sites, vacant land, specialised assets and remote or thin markets all price wider, because they take longer to sell if the exit fails.
Loan purpose
Consumer-purpose facilities are regulated and assessed differently from business or investment-purpose facilities, and the two price differently. See consumer and commercial bridging loans.
Mortgage position
A first-mortgage facility prices better than a second mortgage, because the lender ranks first on enforcement. Second-mortgage and caveat funding sit at the expensive end. See second mortgages.
Loan size and term
Larger facilities can attract sharper pricing through economies of scale. Very small facilities may price higher because the fixed administration cost is spread across less money.
How much does bridging finance cost?
The rate alone will not tell you. What matters is the dollar cost over your actual term, plus the fees.
Worked example. A borrower needs $650,000 against a $1,000,000 property, an LVR of 65%.
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Over 12 months at 8.5% p.a., interest is approximately $55,250.
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Over 6 months at 8.5% p.a., interest is approximately $27,625.
If interest is capitalised, that amount is added to the balance and repaid at exit rather than paid monthly.
Why the rate matters less than you think on a short term. Same $650,000 facility over 6 months:
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At 7.49%: approximately $24,343
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At 8.5%: approximately $27,625
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At 9%: approximately $29,250
The spread between the best and worst rate here is about $4,907 across the whole term. Establishment, valuation and legal fees on a facility this size can comfortably exceed that.
The practical conclusion: chasing a 0.5% rate improvement while ignoring a $10,000 establishment fee is the most common costing mistake borrowers make on short-term finance. Compare the total, not the percentage.
Illustrative only, using simple interest. Some lenders compound monthly. Actual pricing depends on the security, LVR, purpose and exit.
Want an indicative rate for your scenario? Send us the property value, your existing mortgage balance, the amount required and your intended exit. We will come back with indicative pricing and the total dollar cost, including fees, so you can compare like with like. Request an assessment.
Are bridging loan rates fixed or variable?
Most bridging loan interest rates in Australia are fixed for the term. Because facilities typically run 6 to 12 months, lenders generally offer fixed pricing so the borrowing cost is certain from the outset.
Some lenders offer variable structures depending on the transaction, but fixed is the norm. Confirm which applies before you sign, along with what happens to the rate if you need an extension.
How is interest charged: capitalised or serviced?
Two structures, and the choice changes your cash flow rather than your rate.
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Serviced interest is paid monthly from your own funds. On a $650,000 facility at 8.5% that is roughly $4,604 a month.
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Capitalised interest is added to the loan balance instead, so you make no monthly payment and repay the accumulated total at exit. This is what makes bridging workable when you are carrying two properties or have no income from the security. It is also why bridging suits borrowers who would fail a standard serviceability test.
The trade-off is that a capitalised balance grows through the term, which lifts your LVR and shrinks your buffer if the sale price disappoints. See capitalised interest explained.
How do bank bridging loans compare?
Australian borrowers frequently research bridging by bank name, and it is a fair question. Several major Australian lenders have offered bridging or relocation products, and where you fit their criteria a bank is usually the cheaper option, because bank bridging is priced far closer to a standard home loan rate.
The structural differences generally look like this:
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Serviceability. Banks typically assess your capacity to service the peak debt, or the end debt, under their standard criteria. Specialist bridging is assessed primarily on the security and the exit.
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Sale status. Banks often prefer or require the outgoing property to be listed or under contract. Specialist lenders will more often consider an open bridge.
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Speed. Bank assessment usually runs to weeks. Specialist facilities can settle in days where the security is straightforward.
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Security appetite. Banks are narrower on property type, location and borrower structure. Specialist lenders consider company and trust structures, commercial security and complex income more readily.
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Price. Banks are cheaper. Specialist lenders cost more and buy you speed, flexibility and a wider credit box.
So the honest positioning is this. If your income is straightforward, your property is standard, your sale is already contracted and you have several weeks, ask your bank first. Specialist bridging earns its higher rate when one of those four things is not true, which is precisely when a bank will decline or take too long. If a bank has already said no, see declined by lenders.
Bank product availability, pricing, LVR limits and criteria vary between lenders and change without notice. Confirm current terms directly with the lender, or ask us to compare your scenario across bank, non-bank and specialist options.
Fees beyond the interest rate
Interest is only part of the cost. Depending on the lender and the transaction, expect some combination of:
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Establishment or application fee
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Origination or brokerage fee
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Property valuation
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Lender and borrower legal fees
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Title searches and disbursements
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Settlement or account fees
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Extension or default costs if the facility is not repaid on time
On short terms these fixed costs frequently outweigh the interest differential between lenders, which is why they belong in any comparison. Full detail on bridging loan costs and fees.
Why bridging rates are higher than home loan rates
The comparison is intuitive but misleading, because the products do different jobs. A standard mortgage is priced for a 25 to 30 year relationship with a fully assessed borrower. A bridging facility is priced for months, against an exit that has not happened yet, often without monthly servicing, and with the lender carrying the risk that a sale is slower or weaker than forecast.
The right comparison is not bridging rate against mortgage rate. It is the total cost of the facility against the cost of not doing the transaction at all: the property you would have lost, the deposit you would have forfeited, or the price you would have accepted under pressure.
How to get a better bridging loan rate
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Reduce the LVR. The single most effective lever. Contributing cash or borrowing less moves pricing more than negotiating does.
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Evidence the exit. A signed contract of sale changes the risk profile and therefore the price. If you can list before you apply, do.
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Be realistic on the sale price. An optimistic appraisal invites a conservative lender valuation, which raises your assessed LVR and your rate.
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Ask for a longer term than you need. Extensions cost more than the original term. Build the buffer in at the start.
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Get your documents ready first. Speed of assessment does not change the rate, but it widens the pool of lenders who can meet your deadline, and competition is what improves pricing.
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Compare the total, not the rate. Ask every lender for the all-in dollar cost over your expected term.
Who uses bridging loans
Bridging is used by homeowners buying before selling, downsizers, property investors, developers, business owners and self-employed borrowers. See who we help, or the full range of bridging loan use cases.
Frequently asked questions
What is the average bridging loan interest rate in Australia?
Rates typically start from around 7.49% p.a. for consumer facilities and 8.5% p.a. for commercial, with the broader market generally ranging between 7.49% and 12% p.a. depending on structure, security and exit.
How much does bridging finance cost in total?
On a $650,000 facility at 8.5% p.a., interest is roughly $27,625 over six months or $55,250 over twelve. Establishment, valuation and legal fees are additional, and on short terms those fixed costs often exceed the interest difference between lenders.
Why are bridging loan rates higher than home loan rates?
Bridging is short-term, asset-based lending against an exit that has not yet occurred, frequently without monthly servicing. A standard mortgage is priced for a long-term, fully assessed relationship. The products carry different risks and are priced accordingly.
Are bridging loan interest rates fixed?
Most are fixed for the term, which is typically 6 to 12 months. Some lenders offer variable structures. Confirm which applies, and what happens to the rate on extension.
Can bridging loan interest be capitalised?
Yes, in many cases. Interest is added to the loan balance and repaid at exit rather than paid monthly, which removes the monthly repayment obligation but increases the balance and the LVR over the term.
What is the maximum LVR for a bridging loan?
Most facilities are structured up to 65% to 75% LVR depending on property type, borrower profile and exit strategy. Some funders will consider up to 85% depending on the scenario.
Do banks offer bridging loans, and are they cheaper?
Several major Australian lenders have offered bridging or relocation products, and where you meet their criteria a bank is generally cheaper. Banks usually assess serviceability of the peak or end debt, often prefer the outgoing property to be listed or contracted, and take longer. Specialist lenders cost more and buy speed and flexibility.
What is the difference between a rate and a comparison rate on a bridging loan?
A comparison rate is designed for long-term amortising loans and is a poor guide on a facility running a few months. For bridging, ask for the total dollar cost over your expected term including all fees.
Are bridging loans regulated?
Consumer-purpose bridging loans may fall under NCCP regulation and responsible lending obligations. Facilities for business or investment purposes may be NCCP exempt.
How quickly can a bridging loan settle?
Often within several business days once valuation, documentation and legal requirements are complete, depending on the complexity of the security and the transaction.
Will a lower rate always mean a cheaper loan?
No. On a short term, fixed fees frequently outweigh the rate difference. A facility at 7.49% with a high establishment fee can cost more than one at 8.5% with modest fees. Compare the all-in figure. More answers in our bridging loan FAQs, or browse the resources hub.
Speak with a bridging finance specialist
Every bridging scenario prices differently, and the advertised starting rate is only the beginning of the conversation. Structure depends on the property, the LVR, the purpose, the term and the strength of your exit.
Bridging Loans Australia compares bridging options across Australia from a panel of bank, non-bank and specialist lenders. Contact our team for indicative pricing on your transaction, or read more about our brokerage.