Demand for bridging finance remained stable throughout 2019
Demand for bridging finance remained stable throughout 2019 according to MT Finance’s latest Bridging Trends data.
The report shows the average monthly interest rate borrowers paid for bridging loans fell to 0.76%. Also, the average of loan-to-value fell to 53% and the typical completion time was 47 days.
Investment property purchases remained the most popular reason for using bridging loans with 23% of transactions, followed by traditional chain breaks with 18%. The next most popular use for bridging loans was heavy property refurbishments with 14%. The remaining uses included auctions purchases at 7%, re-bridges at 9% and general business purposes at 9%.
Aaron Strutt, product director at Trinity Financial, says: "There are lots of lenders operating in bridging loans and the rates and setup fees can vary a lot. Our brokers have access to a private bank offering bridging loans linked to the Bank of England base rate and relatively low arrangement fees.
"One large providers also offered a 0.48% per month rate up to 50% loan-to-value. It has a 2% completion fee, and it is available for loans between £75,000 and £15,000,000. The price gets marginally more expensive if you have a smaller deposit."
Source: MT Finance
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