Mortgage Rates Drop Again — But Margins Are Slim: What It Means for Bridging Finance in 2025

While fixed mortgage rates are continuing their slow descent, the pace of change is clearly tapering off, according to the latest UK Mortgage Trends Treasury Report by Moneyfacts. This trend signals a shift in the lending environment—one that investors and property buyers should navigate with both caution and agility.

At VIAP Finance, we’re watching these trends closely to ensure our clients always have access to fast, flexible funding alternatives, especially when traditional mortgage options fall short.

What’s Happening with Mortgage Rates?

May 2025 saw only slight reductions in fixed mortgage rates:

• 2-Year Fixed Rate: Down 0.06% to 5.12%
• 5-Year Fixed Rate: Down 0.01% to 5.09%

This minor drop follows more significant cuts earlier in the year. According to Moneyfacts expert Rachel Springall, “Lenders were busy repricing… but the margins of cuts were much smaller than seen a month prior.”

Key highlights:

• The average 2-year rate is now 0.03% higher than the 5-year rate, the smallest gap since October 2022.
• The average shelf life of a mortgage product is just 17 days—signalling a fast-changing landscape.
• Residential mortgage options fell slightly, with 150 fewer products available compared to the previous month.

What This Means for Property Buyers and Investors

While mortgage rates are falling, they’re doing so at a slower pace, and the gap between short- and long-term fixes is narrowing. This makes timing critical, especially for:

• Buyers trying to lock in favourable terms
• Investors who rely on liquidity to act quickly
• First-time buyers navigating evolving stress tests and criteria

If you're caught between deals or face delays in securing a traditional mortgage, bridging finance becomes a powerful tool to stay ahead.

VIAP Finance: Bridging the Gap When Mortgages Fall Short

At VIAP Finance, we offer fast, affordable bridging loans tailored for speed and flexibility—perfect for moments when mainstream lending can’t move fast enough.

Our Core Services:

• Residential Bridging Loans – Unlock funds to secure your next home, even when you're in a broken chain.
• Bridge to Let Loans – Ideal for landlords preparing to transition to a buy-to-let mortgage.
• Commercial Bridging Loans – Flexible capital for offices, shops, and mixed-use properties.
• Auction Property Finance – Fast financing to secure properties won at auction.
• Development & Exit Finance – Finish builds or refinance your exit strategy without delay.
• Rebridging Solutions – Extend or replace an expiring loan, giving you breathing space.
• Specialist Lending – Finance for care homes, retail parks, and other complex assets.
• Let’s Talk About Your Next Move
• Whether you're bridging a gap while waiting for a mortgage, financing a renovation, or seizing a time-sensitive investment opportunity, VIAP Finance is here to help.

Contact us today to discover how bridging finance can work for you—when timing and flexibility matter most.