Bridging lenders display optimism
According to Benson Hersch, the chief executive of the Association of Short Term Lenders (ASTL), bridging finance lenders are optimistic about the future.
A March 2017 survey of ASTL members found that 100% of them expect the future volume of bridging lending to either remain the same or increases in the near future.
An article on TheTimes.co.uk from the same month reported that property sales are taking longer. In Bradford, Liverpool and Wolverhampton, 25% of homes have been on the market for six months of more. This has led to more ‘chain blocking’, where completing a house purchases is dependent on a chain of buyers completing their purchases. Bridging loans can provide short-term finance to complete house purchases quickly and unblock the chains.
People desperate to move are finding bridging loans the ideal solution. Hersch, writing for MortgageStrategy.co.uk in May 2017, said that bridging finance brokers need to be skillful in matching a borrower’s needs to the right bridging loan. He also calls on solicitors to understand bridging finance and make sure that their legal work is done quickly.
Hersch noted that the bridging lending market is very competitive with new lenders entering the market. The majority of ASTL members surveyed expect competition to continue. Thanks to competition, it is expected that interest rates and fees will remain low.
Hersch is positive about the outlook for bridging finance, but warns against over confidence as there is economic uncertainty caused by Brexit and the upcoming general election.