What happens if planning takes longer than your bridging loan?

By the Bridge & Build Finance team · 19 October 2026

What did the HBF and Paragon report find?

The HBF report, Analysing the impact of Planning Performance Agreements, looks at how councils use planning performance agreements (PPAs). These let an applicant pay for extra council resources and agree a timetable for the application. Using Freedom of Information requests, HBF found:

• 85 councils responded. On average each received almost £600,000 in PPA fees between 2022 and 2025.
• 12 councils received more than £1 million, seven of them in London. The City of London received almost £5 million.
• Across England and Wales, HBF estimates PPA income came to almost £200 million. This is an estimate scaled up from the responses, not a recorded total.

The report argues that official statistics can show applications decided within agreed timescales while hiding how much longer many of them actually take. It also warns that relying on paid agreements creates a two-tier system that may put smaller developers at a disadvantage.

As reported by Bridging Loan Directory, Neal Moy, managing director of Paragon Development Finance, said unpredictable planning timetables create uncertainty for lenders over delivery and funding, and keep architects and consultants on the payroll for longer. "PPAs have a useful role in complex schemes, but they should not compensate for underlying capacity constraints," he said. Paragon is one of the lenders on our panel; see our Paragon Bank lender profile.

How long does a planning application take?

The government's guidance on determining a planning application sets the statutory time limits:

• 8 weeks for most applications, including smaller schemes.
• 13 weeks for major development.
• 16 weeks where an Environmental Impact Assessment is needed.

Those limits can be extended. A council and applicant can agree a longer period in writing, and where a PPA sets a longer timetable, the statutory limit no longer applies. A PPA commits both sides to a process, not to a decision: the guidance says it "does not commit the local planning authority to a particular outcome". If a council misses the deadline, you can appeal for non-determination, and the application fee is refunded if a decision is still outstanding after 26 weeks for a major scheme or 16 weeks for others, unless a longer period was agreed.

In practice, many decisions take far longer than the statutory periods. Our report on housing supply and planning reform covers HBF's earlier finding that only around one in five major applications is decided within 13 weeks.

What happens if my bridging loan ends before planning is granted?

A bridge has a fixed term. If planning is still pending when it ends, the usual options are:

• Extend with your current lender. Many lenders will consider it, but it is at their discretion and usually comes with an extension fee, legal costs and often a new valuation. Our guide can you extend a bridging loan? explains how it works.
• Refinance onto a new bridge. Re-bridging repays the first lender with a new one, but the new lender will value the site as it stands, without the planning you hoped for.
• Repay from other funds or sell. Selling a site before planning is decided can mean accepting a lower price.

Recent cases show the cost. A Bridging Loan Directory feature published on 15 October described one borrower whose bridge expired a day before the planning committee approved the scheme. The extension, new valuation, fees and legal work cost around £10,000, and the new valuation came in below the original purchase price. In another case, a lender agreed an extension with a 1% fee, a monthly rate 0.3 percentage points higher and a requirement to pay the interest monthly.

Mike Feasey, head of bridging at Secure Trust Bank Business Finance, told the publication that lenders need to understand why an exit has been delayed and what the revised route to repayment is. "Leaving that conversation until maturity reduces the time available to assess the options," he said. If you cannot repay at all, read what happens if you can't repay a bridging loan.

How should I plan a bridge around a planning decision?

• Choose a term longer than the planning timetable. Allow for validation, consultation, committee dates and conditions, then add a margin. Our guide to bridging exit strategies sets out what lenders expect.
• Ask about extensions before you sign. Find out how the lender handles extensions, what it charges and whether rolled-up interest would cover a longer term.
• Price the land on what it is worth today. A lender will value a site without planning on its current use. Our guides to planning gain and land value and residual land value explain the gap.
• Budget for the planning costs. PPA fees, consultants and reports all need funding while you wait.
• Line up the next stage. Once planning is granted, most schemes move onto ground-up development finance. See do you need planning permission for development finance?

As Mike Feasey put it: "An ambitious sales estimate or an optimistic completion date should not be a substitute for a robust repayment plan."

What it means for your funding

Buying before planning can still pay off, because the value uplift from a consent goes to whoever holds the site. But the bridge needs to be sized and timed for slow decisions, not best-case ones. Planning gain bridging is designed for buying and holding a site while you apply, and land finance covers sites with or without planning. If your current bridge is close to its end date, speak to your lender now and look at your refinance options in parallel. We search the market and approach the lenders on our panel whose criteria fit your site and timetable.

Common questions

This article reports news and published figures as at 19 October 2026. It is for general information only and is not legal, tax or financial advice. Bridge & Build Finance is a commercial finance brokerage service, not a lender. Finance is subject to status, lender criteria, valuation, underwriting and approval.