Short-term gap funding between two defined events: a settlement, a contract milestone, a known incoming receivable. Higher rate band, shorter term, often interest-only with a bullet at the end. Indicative costs, NZ specialists, and three borrower scenarios.
Last reviewed 5 May 2026
Indicative repayment
Weekly
$10,012/week
Indicative only. Not a quote or offer of credit. Actual rates, fees, and repayments depend on the business profile and the lender's decision.
Sending to Prospa
6 months at 14.00%. Prospa will ask a few quick questions, then provide a firm quote and funding if eligible.
Redirecting…
Indicative only. Why we say this
Quick answer
What it is
Bridging finance is short-term borrowing used to fund the gap between two known events. The classic NZ pattern is bridging the sale of one commercial property to the purchase of another, where the buy settles before the sell, and the borrower needs interim funding to hold both lines for 30 to 90 days. The same structure applies across other timing gaps: a delayed settlement that pushes the cash-in date out by weeks, a contract milestone payment landing after a tax or supplier bill is due, or a known incoming receivable that lands 60 to 120 days after the funding need.
The defining feature is the exit. Bridging finance is structured around a specific event that produces the cash to clear the loan: the sale settlement, the contract milestone, the receivable settlement. Lenders underwrite the exit as carefully as the borrower's servicing capacity, because the loan is typically repaid as a bullet at the end of the term rather than amortised across it. Where the exit is undefined or speculative, the application is widely re-classified as standard short-term lending and priced accordingly.
Bridging facilities in NZ commonly run 3 to 12 months, price in the 12% to 18% indicative band, and are often interest-only across the term with a bullet repayment on settlement. Security is commonly registered against property (residential or commercial), other business assets, or a caveat over a known receivable. NZ specialists in this segment include Avanti Finance, Liberty, Pearler, and Cressida, with major-bank bridging available for established commercial borrowers at the lower end of the rate band.
Typical amount
$50K to $5M+
Term
3 to 12 months
Security
Often property or asset
Rate band
12% to 18% indicative
Common scenarios
01
A NZ business buying a new warehouse for $2.4M with the existing premises listed and expected to settle 60 to 90 days later. A bridging loan covers the buy until the sell completes, typically secured against both properties.
02
A signed sale-and-purchase agreement on a commercial site with the buyer extending settlement by 4 to 8 weeks. A bridging facility covers operating cash needs until the delayed settlement clears.
03
A construction contractor invoicing a $400K milestone 30 days after suppliers and PAYE are due. A bridging loan secured against the milestone receivable smooths the gap.
04
A $90K provisional tax instalment landing 45 days before a confirmed $260K project payment settles. A short bridging loan covers IRD and clears on receipt of the project payment.
05
A successful auction bid on a commercial property with bank-finance approval still finalising. A bridging facility covers the deposit and short settlement window until the long-term loan funds.
06
A known estate distribution or business-sale earn-out landing 4 to 9 months after a current cash need. Bridging covers the gap, secured against the documented incoming payment.
07
A pending refinance from one NZ lender to another with a 4 to 6-week funding gap between exit and new drawdown. A bridging facility covers the interim period.
Structures
First or second mortgage registered over residential or commercial property. The dominant structure for property buy-before-sell scenarios. Interest-only with bullet repayment on settlement.
Caveat lodged against a known receivable, milestone payment, or pending settlement. Suits scenarios where the exit is a contractual incoming payment rather than a property sale.
Short-term unsecured loan used as a bridge against a defined incoming event, typically smaller amounts. Higher rate band reflects the absence of registered security.
Decision matrix
| Feature | Property-secured | Caveat-secured | Unsecured short-term | Standard term loan |
|---|---|---|---|---|
| Commercial buy-before-sell | Best fit | Marginal | No | Inefficient |
| Delayed property settlement | Best fit | Works | Marginal | Inefficient |
| Contract milestone bridging | Works | Best fit | Works | Marginal |
| Tax bill before receivable | Marginal | Works | Best fit | Inefficient |
| Auction purchase pre-finance | Best fit | Works | Marginal | Inefficient |
| Earn-out or trust distribution | Works | Best fit | Works | Marginal |
| Refinance settlement gap | Best fit | Works | Marginal | Inefficient |
Worked scenarios
Commercial property
An East Tamaki distribution business buying a larger $2.6M warehouse in Highbrook with the existing $1.8M East Tamaki site listed and expected to settle 90 days later. The buy contract gives 30 days to settlement.
Structure: $1.5M property-secured bridging loan at indicative 13% p.a. across 6 months, interest-only with a bullet on the existing-site settlement. Monthly interest cost runs around $16,250 across the bridging period. Total interest commonly runs around $97,500 across the 6 months in this scenario, on these assumptions.
Indicative figures
Construction
A Hamilton civil-construction contractor with a $480K milestone payment confirmed for settlement on day 60, but $180K of supplier and PAYE costs landing across days 1 to 30. The milestone is contractually documented against an established council client.
Structure: $200,000 caveat-secured bridging loan at indicative 16% p.a. across 4 months, interest-only with a bullet on milestone receipt. Monthly interest cost runs around $2,670 in this scenario, on these assumptions.
Indicative figures
Wholesale and export
A Petone-based exporter mid-refinance from one NZ alternative lender to a major-bank facility, with a 5-week funding gap between the existing facility expiry and the new drawdown date. Operating cash flow needs $300K of cover across the gap.
Structure: $300,000 property-secured bridging loan at indicative 14% p.a. across 3 months, interest-only with a bullet on new-facility drawdown. Monthly interest cost runs around $3,500 in this scenario, on these assumptions. Total interest across the bridge runs around $10,500.
Indicative figures
Common pitfalls
01
A 90-day buy-before-sell that drifts to 150 days produces 60 days of additional bridging interest at the higher rate band. The widely observed discipline is to size the term against the realistic worst-case exit, not the expected one.
02
Bridging without a documented exit (signed sale-and-purchase agreement, contractual milestone, settlement notice) is widely re-priced as standard short-term lending or declined. NZ bridging specialists underwrite the exit as carefully as the borrower.
03
Bridging facilities commonly carry establishment fees of 1% to 2.5% of the loan, legal and valuation costs, and exit fees on early or late settlement. The total cost commonly runs 1 to 2 percentage points above the headline rate.
04
Where the exit event slips beyond the original term, the bridging lender commonly offers a rollover at a higher rate or with additional fees. The discipline is to pre-discuss the rollover terms before drawdown rather than under pressure.
05
Using a second bridging loan to clear the first when the original exit fails is a widely flagged risk pattern. Each layer compounds the cost and the eventual recovery scenario gets harder.
06
Director PGs are standard on most NZ bridging facilities. Where the exit fails, PG enforcement on residential or personal assets is a real consequence. The accountant or solicitor conversation usually pre-tests the scenario.
Eligibility
NZ bridging lenders typically focus the credit assessment on three things: the security position (LVR against property or quality of caveat-secured receivable), the exit (documentary evidence that the cash-in event will land), and the borrower's ability to service the interest across the term. Trading history matters less than for standard term lending; the exit is what carries the loan.
A typical commercial-bridging application carries the borrower entity details (NZBN, ownership structure), a registered valuation on any property security, the documentary evidence of the exit (signed sale-and-purchase agreement, contract milestone schedule, refinance approval letter), the last 6 to 12 months of business bank statements, and a brief on the loan purpose. Avanti, Liberty, Pearler, and Cressida each operate slightly different application processes; brokers are widely used in this segment because the matching of borrower to specialist is non-trivial.
LVR limits commonly run 65% to 70% on first-mortgage commercial bridging, 55% to 65% on second-mortgage scenarios, and lower on caveat-only positions. Interest is typically capitalised or pre-paid at drawdown on the larger facilities, which means the borrower funds the interest from the loan principal rather than monthly cash flow. The accountant conversation usually settles whether capitalised interest sits cleanest for the specific position, subject to the accountant's confirmation.
Sole traders and personal guarantors can engage CCCFA where the borrowing is wholly or predominantly for personal use, which is uncommon on commercial bridging but worth flagging on the application. Final rate, fees, LVR, and approval are subject to the lender's credit assessment and the registered valuation outcome.
Lenders to know
Best for commercial and residential bridging up to $5M
NZ-owned non-bank lender with a substantial bridging book. Funds property-secured commercial bridging across NZ regions, with first and second-mortgage positions.
Indicative rate band:10% to 14% p.a.
Read onBest for short-term commercial property bridging
Australasian non-bank lender active in NZ commercial bridging. Suits first-mortgage commercial property bridging with documented exit.
Indicative rate band:11% to 15% p.a.
Read onBest for flexible commercial bridging and caveat lending
NZ commercial-finance specialist active in caveat-secured and second-mortgage bridging across commercial property and receivable-backed exits.
Indicative rate band:12% to 17% p.a.
Read onBest for NZ commercial bridging and structured short-term
NZ-based commercial-bridging specialist focused on property-secured short-term lending with structured exits across the 3 to 12-month band.
Indicative rate band:12% to 18% p.a.
Read onBest for unsecured short-term bridging under $150K
Our finance partner. Small Business Loan suits small unsecured bridging where speed matters more than the lowest rate.
Indicative rate band:12% to 22% p.a.
Read onReferences
Where caveat and asset-secured bridging registrations are recorded.
Where property-secured bridging mortgages are registered against the title.
NZ commercial-lending volume and rate context.
CCCFA framing for sole-trader and personal-guarantor edge cases.
Tax treatment framing for capitalised interest and bridging-cost deductibility.
FAQ
Bridging finance is short-term borrowing used to fund the gap between two known events: a property buy-before-sell, a delayed settlement, a contract milestone payment, or a known incoming receivable landing after a current cash need. The defining feature is a documented exit event that produces the cash to clear the loan.
Indicative rates run 12% to 18% per annum across most NZ commercial bridging, with first-mortgage property-secured bridging at the lower end and unsecured or caveat-only positions at the upper end. Establishment fees of 1% to 2.5% of the loan, legal costs, and valuation costs commonly add 1 to 2 percentage points to the effective cost.
Common terms run 3 to 12 months. Anything longer is typically a refinance into a standard term product rather than ongoing bridging, because the rate band reflects the short-term nature of the structure. Rollovers are available with most NZ specialists where the exit slips, commonly at a higher rate or with additional fees.
Most NZ commercial bridging is structured interest-only with a bullet repayment on the exit event. On larger facilities, interest is sometimes capitalised or pre-paid at drawdown, which means the borrower funds the interest from the loan principal rather than monthly cash flow.
Standard documents are NZBN and entity ownership details, a registered valuation on any property security, the documentary evidence of the exit (signed sale-and-purchase agreement, contract milestone schedule, refinance approval letter), the last 6 to 12 months of business bank statements, and a brief on the loan purpose.
Avanti Finance, Liberty Financial, Pearler, and Cressida are widely active in NZ commercial bridging, with major-bank bridging available for established commercial borrowers at the lower end of the rate band. Brokers are commonly used because the matching of borrower scenario to specialist appetite is non-trivial.
LVR limits commonly run 65% to 70% on first-mortgage commercial bridging, 55% to 65% on second-mortgage scenarios, and lower on caveat-only positions. The registered valuation drives the calculation; off-market or auction valuations are commonly assessed conservatively.
Interest on a bridging loan used wholly for business purposes is generally deductible against business income in New Zealand, subject to the accountant's confirmation. Capitalised interest treatment varies depending on the specific structure and is a question the accountant typically settles on review of the loan documents.
Where the documented exit slips beyond the original term, the bridging lender commonly offers a rollover at a higher rate or with additional establishment fees. The widely observed discipline is to pre-discuss rollover terms before drawdown so the borrower understands the cost of an extended bridge.
On a failed exit, the lender enforces the registered security: the property is realised through mortgagee sale, the caveat is enforced against the receivable, or the unsecured loan defaults to the personal guarantee. Recovery scenarios are widely treated as the structural test of whether bridging fits the situation in the first place.
Yes, sole traders and partnerships are eligible across most NZ bridging specialists where a documented exit and acceptable security are in place. CCCFA can engage where the borrowing is wholly or predominantly for personal use, which is uncommon for commercial bridging but worth flagging on the application.
No, bridging finance is differentiated by the documented exit event and the typically interest-only structure with a bullet at the end. A short-term business loan is amortised across the term and serviced from operating cash flow, regardless of any specific incoming event. Bridging is widely re-classified as standard short-term lending where the exit is undefined or speculative.
Related
Commercial property loan
The longer-term structure that bridging facilities commonly refinance into after settlement.
Read onShort-term business loan
The closest alternative where no documented exit event is in place.
Read onAvanti Finance
NZ-owned non-bank lender active in commercial and residential bridging up to $5M.
Read onMotel and accommodation loans
Bridging finance is common at motel ownership transitions before going-concern bank funding settles.
Read onDisclaimer
A business loan is a commitment that runs for months or years, and repayments come out of the same operating cash flow as everything else. Before committing, it is worth modelling the weekly and monthly cost against the business's working-capital position, which is what this site is built to help with. Borrowing at a level that stays comfortable through a quiet quarter, not just a strong one, is widely regarded as the safer frame.
What this site is
A calculator and information tool. Not a lender, not a broker, not a registered financial adviser. Nothing here is personalised financial advice.
What the figures show
Modelled estimates based on the inputs you enter. Not a quote. Not an offer of credit. Not a guarantee of approval, rate, or fees.
What the lender decides
Final rates, fees, and approval are set by the lender after a CCCFA-appropriate assessment of the applicant's circumstances and credit decision.
Commercial disclosure
Businessloans.org.nz earns a commission from Prospa when a visitor applies through this site and their application is approved. The commission is paid by Prospa, not by the borrower, and it does not influence the rate Prospa offers. Full disclosure on the partner page.
Tax, GST, and accountant framing
Tax-treatment statements (GST claim timing, interest deductibility, depreciation rates) are general in nature and subject to your accountant's confirmation on the specific business position. For material amounts, professional advice from a registered financial adviser or chartered accountant is widely regarded as the safer frame.
