Guide
Regulated vs Unregulated
Bridging Loans
The distinction matters. Which type you need depends on the property and how you use it.
Written by Justin, Principal · Updated
Our guides are researched and drafted with digital tools, then written and approved by Justin, Principal, from his own experience.
One question decides it: will you or your family live in the property? If yes, the loan is regulated and belongs with an FCA-authorised firm. If no, it is a business or investment loan, and that is what we arrange.
The simple rule
The distinction comes down to the home. Is the property one you or your family live in, or will live in? If so, the loan is regulated. If not, it is unregulated.
We arrange unregulated loans only.
Getting the classification wrong can delay or derail a deal, so settle it first.
Intended use decides it, not who you are
The test looks at how the property will be used, not at how experienced you are. A professional investor who plans to live in the property needs a regulated loan. A first-time buyer who buys a flat to let out, and will not live in it, does not need one.
- An investor buying a block with tenants already in it: unregulated. The tenants do not change the classification.
- A borrower renovating a property to sell: unregulated, if neither they nor their family will live there.
- A borrower renovating a property they plan to move into: regulated. Intended use counts, not how the property looks today.
Why it matters
| Factor | Regulated | Unregulated |
|---|---|---|
| Who can arrange it | An FCA-authorised firm | We can, for business or investment purposes |
| How long we typically take | Not a loan we arrange | Typically 5 to 7 working days |
| What the loan is for | A home you or your family live in | Investment, commercial, land and development |
What falls under unregulated
Investment property
Property bought as an investment: buy-to-let, HMOs, holiday lets and serviced accommodation. The borrower does not live in it.
Commercial property
Offices, retail units, warehouses, industrial units and mixed-use buildings, where neither you nor your family live in the building.
Land and development
Agricultural land and development sites, with or without planning permission.
The key test is the same every time: does the borrower, or their family, live in the property or intend to? If not, the loan is unregulated.
What falls under regulated
Buying a home to live in
If you are buying a property to live in, the loan is regulated, whatever the property type.
Secured on your current home
A loan secured on the home you live in is regulated, even if the money is for business.
Family occupation
If your family lives in the security property, the loan can be regulated even if you live elsewhere.
If any of these applies, you need an FCA-authorised firm. We cannot arrange a regulated loan.
Three things people get wrong
"I am a professional investor, so my loan is unregulated." Not by that fact alone. What decides it is whether you or your family will live in the property.
"Unregulated means riskier." It means different. It is a legal classification and says nothing, on its own, about the lender or the deal.
"Any broker can arrange a regulated loan." No. Arranging a regulated loan needs FCA authorisation for that activity. We are not authorised or regulated by the FCA and we do not arrange regulated loans. If your loan is regulated, you need an FCA-authorised firm.
For wealth managers
Wealth managers advising high-net-worth clients can read how we work with them.
We arrange unregulated business and investment loans, for business or investment purposes only - never secured on a home you or your family live in. A loan on such a home is regulated lending and belongs with an FCA-authorised mortgage adviser. Funding Developers Limited is not authorised or regulated by the Financial Conduct Authority.
Related Finance
Not sure which side of the line you are on?
Tell us who lives in the property and what the money is for. We will tell you in one call whether it is a deal we can arrange. It is a confidential, no-obligation chat.