A survey by United Trust Bank found that 57% of brokers who work in the bridging, asset finance and development areas believe that lenders will keep their credit policies largely the same over the next year.
The managing director of the United Trust Bank, Harley Kegan, said that most brokers think that
lenders are operating with an eye to the future. However, 32% of lenders think that the uncertainty of Brexit, the UK economy and the residential property market could mean that lenders will tighten their credit policies over the next twelve months. Around 11% of brokers think that lending rules will be relaxed.
Brokers have reported that some lenders are more cautious about providing loans. Even well established borrowers can have their loan applications refused.
Harley Kegan stressed the important role that small specialist lenders can play:
“From a broker perspective, there are obvious advantages to dealing with a specialist lender which can quickly adapt to changing market conditions and be flexible in applying their credit policy to marginal cases.”
Alternate lenders will tend to look at a loan application on its own merits, rather than apply blanket tick box criteria to loan applications. Many bridging lenders specialise in particular markets such as auction finance and are able to assess an application using specialist knowledge and experience.
Lenders are keen to help house builders and property developers and will support them with bridging finance through the ups and downs of the housing market.