In the UK, bridging loans can be regulated or unregulated, depending on the specific circumstances of the borrower and loan circumstances.

Regulated bridging loans are subject to regulation by the Financial Conduct Authority (FCA). They are typically used by individual borrowers using the loan to purchase a residential property that will be their primary residence. Regulated bridging loans are subject to strict rules and protections, including requirements for clear and transparent pricing, fair lending practices, and the provision of pre-contractual information.

Unregulated bridging loans, on the other hand, are not subject to the same level of regulation as regulated loans. They are typically used by businesses or investors rather than individual borrowers. They may be used to purchase commercial property or finance a property development project. Unregulated bridging loans may be riskier for borrowers, as they may come with higher interest rates and fewer consumer protections.

When considering a bridging loan, it’s essential for borrowers to carefully evaluate their options and assess the risks and benefits of regulated and unregulated loans. Borrowers should also work with a reputable lender or broker who can provide clear and transparent information about the terms and conditions of the loan, as well as any associated fees.