Bridging brokers

42% of brokers call for higher LTVs in bridging

Some 42% of brokers would like to see higher LTVs on offer in the bridging market, according to the latest broker sentiment survey.

The research conducted by bridging lender mtf found that none of the broker respondents felt the need for lower rates or further transparency.

Bridging loan volumes rose by almost a third in the first quarter of 2018 as demand for short-term finance remained positive.

Some 30% of the 119 brokers surveyed witnessed a rise in bridging loan volume, with the biggest demand recorded in the South East at 50% (Q4 2017: 47%).

More than one-third of brokers (37%) claimed that competition was a key issue facing the bridging finance sector during the first quarter of 2018.

Almost two-fifths of brokers (39%) said that interest rates and pricing were most important when choosing a bridging lender, while 33% cited flexibility as a key issue, with 26% claiming speed of completion as a major factor.

Just 2% of brokers surveyed said that an existing relationship with a lender was the most important factor.

Just over a quarter of respondents (27%) said that they wanted greater flexibility on commercial lending, while 26% wanted faster turnaround times.

During the first quarter, the most popular reason for taking out a bridging loan was to fund a development project at 27% (Q4 2017: 19%), followed by the purchase of an investment property (24%) and refurbishment (21%).

James Anderson, head of new business at mtf (pictured above), said that the feedback from brokers pointed to a strong need for specialist lending.

“Bridging finance is increasingly being used as a viable financial tool to provide real-time funding to plug any gap before longer-term finance can be put in place."

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