The latest Bridging Trends data revealed that regulated bridging loans fell to 36.8% of bridging lending in the second quarter of 2018. This is down from the first quarter’s figures of 43.7% of the total loans. The total volume of bridging finance was £197.94 million in the second quarter of 2018, an increase of £43.9 million compared to the first quarter. A third of all lending was for refurbishment work, an increase of 18% on the first quarter of 2018. Bridging loans used for mortgage delays and property auction purchases were down by a quarter. Many investors are upgrading their properties to add value by improving rental yields and capital growth. Often loans are used to refurbish property to add value before selling and the loan repaid out of the proceeds of the sale. Another reason for refurbishment loans is for houses bought cheaply at property auctions that need refurbishment work before they qualify for a mortgage. Refurbishment work can range for small alterations to large projects that need planning permission. The average loan to value levels for bridging loans in the second quarter increased by 7.8% to 56.9%. The average monthly interest was 0.83%, the same as in the first quarter. Completion times fell by an average of 5 days to 43 days. The average term of loans is 11 months, which is the same as the previous quarter. With so many bridging loans available for many different purposes, a bridging finance broker can source the best loans deals.
May 10, 2022
