Bridging Loan Ireland
Bridge the gap: Fast funding when you need it most
What is a Bridging Loan?
A bridging finance loan, often called a ‘bridging loan’ or sometimes known as ‘gap financing’, is a short-term loan designed to help you cover immediate financial needs until you can secure more permanent financing. Think of it as a financial bridge that helps you get from one point to another.
Bridging Loans Guide – Go To:
How does a Bridging Loan work?
Imagine you want to buy a new home, but you haven’t sold your current one yet. A bridging loan can provide the funds you need to purchase the new home without waiting for the sale of your old one. Once your old home is sold, you can use the proceeds to pay off the bridging loan.
2026 Central Bank’s New Bridging Loan Policy
The Key Details: What You Need to Know
- Goodbye LTI Limits: Your borrowing capacity for the bridging element is no longer restricted by a strict multiple of your annual salary.
- LTV Limits Still Stand: The Loan-to-Value (LTV) rules have not changed. You will still need to hold the required deposit or equity percentage relative to the value of the property you are purchasing.
- Your Main Home Only: This regulatory break is strictly reserved for “Principal Private Residences.” It is built to help homeowners move, so it does not apply to holiday homes or buy-to-let investment properties.
- Strictly Short-Term: To qualify under these amended rules, the bridging loan must have a maximum term of 18 months, giving you a clean window to wrap up your sale.
Types of Bridging Loans Ireland
Bridging loans are a versatile financial tool that can be tailored to meet various needs. In Ireland, there are several types of bridging loans available, each designed to address specific financial situations. At JC Mortgages we offer:
Trading down
Trading down involves selling a more expensive property to purchase a less expensive one. A bridging loan can provide the necessary funds to secure the new property before the sale of the existing one is completed. This ensures a smooth transition without the need to wait for the sale proceeds.
Features and Benefits
| 12-month term | For Accumulated Interest (no minimum term) |
| 18-month term | For Interest Only (no minimum term) |
| No extra penalty | For paying off the loan early, either partially or fully |
| Up to 70% | Loan to Valueratio |
| Loan size | Minimum €100,000, Maximum €1.5 million |
| Property value | Minimum €145,000, no maximum limit |
| Applicant age | Minimum 21 years, maximum 70 years at loan maturity |
| Annual income | Minimum €40,000 (for single or joint applications) |
| Up to 4 applicants | can be on each mortgage |
| Lending areas | Properties in Dublin and surrounding counties (Kildare, Wicklow, Meath), Galway, Cork, Limerick, Dundalk, Drogheda, Waterford City, and other urban centers with a population of 5,000 or more |
Buy to let renovation
For property investors looking to renovate a buy-to-let property, a bridging loan can offer quick access to funds. This type of loan allows investors to purchase and refurbish a property, increasing its value and rental potential before securing long-term financing.
Auction finance
Individual – Buy To Let Renovation & Auction
Features and Benefits| 12-month term | For Accumulated Interest (no minimum term) |
| 18-month term | For Interest Only (no minimum term) |
| No extra penalty | For paying off the loan early, either partially or fully |
| Up to 70% | Loan to Value ratio |
| Loan size | Minimum €100,000, Maximum €1.5 million |
| Property value | Minimum €145,000, no maximum limit |
| Applicant age | Minimum 21 years, maximum 70 years at loan maturity |
| Annual income | Minimum €40,000 (for single or joint applications) |
| Up to 4 applicants | Can be on each mortgage |
| Lending areas | Properties in Dublin and surrounding counties (Kildare, Wicklow, Meath), Galway, Cork, Limerick, Dundalk, Drogheda, Waterford City, and other urban centers with a population of 5,000 or more. |
Company – Buy To Let Renovation & Auction
Features and Benefits| 12-month term | For Accumulated Interest (no minimum term) |
| 18-month term | For Interest Only (no minimum term). No extra penalty for paying off the loan early, either partially or fully |
| No extra penalty | For paying off the loan early, either partially or fully |
| Up to 70% | Loan to Value ratio |
| Loan size | Minimum €100,000, Maximum €1.5 million |
| Property value | Minimum €145,000, no maximum limit |
| Company requirements | Must be registered in Ireland, with at least one Irish resident Director earning a minimum annual income of €40,000 |
| Professional Landlord | Must own at least 2 investment properties |
| Borrowing limits |
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| Lending areas | Properties in Dublin and surrounding counties (Kildare, Wicklow, Meath), Galway, Cork, Limerick, and other urban centers with a population of 5,000 or more |
Bridging loan examples
A married couple in their late 50s is looking to downsize to a smaller, more manageable property. They currently own a property valued at €3.1 million, with an outstanding mortgage debt of €500,000 to their current lender. They have agreed to purchase a new property for €1.6 million.
Financial details:
- Current Property Value: €3.1 million
- Outstanding Debt: €500,000
- New Property Purchase Price: €1.6 million
- Total Loan Sought: €1.7 million on an accumulated interest Trade Down product
Explanation
The couple is seeking a bridging loan to cover the purchase of their new home before selling their current property. This type of loan, known as a Trade Down bridging loan, allows them to secure the new property without waiting for the sale of their existing one. The loan amount of €1.7 million will cover the purchase price of the new property (€1.6 million) and provide additional funds to manage any associated costs or fees.
Benefits:
Immediate Access to Funds: The bridging loan provides the necessary funds to purchase the new property quickly, ensuring they don’t miss out on their desired home.
Flexibility: The loan allows them to move into their new home and settle in before selling their current property.
Smooth Transition: By securing the new property first, they can avoid the stress and uncertainty of coordinating the sale and purchase simultaneously.
Additional Details:
Clearing Existing Debt: The couple will use part of the loan to clear the outstanding €500,000 debt on their current property.
Balance of Funds: After clearing the debt, they will have €400,000 in savings to cover the balance of the new property purchase.
Refurbishments: Once they have moved into the new property, they plan to carry out some light refurbishments to enhance its value.
Repayment Plan: After completing the refurbishments, they will sell their existing home and use the proceeds to repay the bridging loan in full.
By using a Trade Down bridging loan, the couple can smoothly transition to their new home, ensuring a seamless and stress-free move.
A landlord has found a chance to buy a 3-bedroom, 1-bathroom property that needs some cosmetic upgrades to boost its value.
Property Details:
- Current Value:€150,000
- Projected Value:€225,000
- Projected Rent:€2,000 per month
Renovation Needs
The property needs a new bathroom and kitchen, along with other cosmetic improvements, costing around €25,000. The landlord believes these upgrades will make the property more attractive to high-quality tenants and ensure its long-term value. The renovation work is expected to take 8-10 weeks.
Loan Details
- Loan Amount:€102,500 (69% of the current property value) on an interest-only basis.
- Loan Balance at Expiry:€104,876 (including exit fee).
- Monthly Repayments:€1,048 over a maximum term of 18 months (no minimum term).
Exit Strategy
The landlord plans to refinance the property with a standard long-term buy-to-let mortgage once the renovations are complete. With the new property value at €225,000, JC Mortgages can secure a loan up to 70% LTV (€157,500), which will cover the bridging loan amount of €102,500 and reimburse the renovation costs.
Outcome
The landlord has successfully transformed an older home into a modern rental property, achieving a gross yield of 10.6%.
How long does it take to secure a Bridging Loan?
Bridging loans in Ireland are popular because they get approved and processed quickly. The exact time it takes to get approved can vary based on the lender and how complicated your application is, but here’s a general idea of what to expect:
- Urgent cases –it’s possible to complete the entire application process within 48 hours
- Standard application –the process typically takes one to two weeks
- Compared to traditional mortgages – which can take 30-60 days to approve, bridging loans are significantly faster
Even though getting approved for a bridging loan can be fast, actually receiving the funds might take a bit longer, depending on your situation. Still, bridging loans are one of the quickest ways to get financing in the Irish property market.
First Time Buyer - FAQs
1. Can I get a mortgage if I am on probation?
Generally, lenders require you to have completed your probation period before drawing down a mortgage. However, if you have a strong track record in the same industry, we may be able to negotiate an exception with specific lenders.
2. What is the "Fresh Start" principle?
This is a rule allowing people who are divorced, separated, or have gone through insolvency to be treated as first-time buyers for state schemes (like the First Home Scheme), provided they no longer have a financial interest in their former family home.
3. Do I need to have the 10% deposit in cash?
Not necessarily. If you are buying a new build, the Help to Buy grant (up to €30,000) can often cover the bulk of your 10% deposit requirement. However, you will still need cash for stamp duty (1%) and legal fees.
4. How long does "Approval in Principle" last?
Approval in Principle (AIP) typically lasts for 6 to 12 months, depending on the lender. It is not a binding contract but proves to estate agents that you are a serious buyer.
5. What is the difference between the First Home Scheme and the Local Authority Home Loan?
The First Home Scheme is an equity scheme where the state buys a share of your private home. The Local Authority Home Loan is a mortgage loan from the council for people who have been refused by two banks. You can sometimes use them together, but they serve different purposes.
First Time Buyers why choose JC Mortgage Brokers?
With 20+ years in the mortgage industry, John Coleman and his team of expert mortgage advisors are ready to help you secure your first property in Ireland, ensuring you have a specialist on hand from the start to the end of your mortgage process.
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