Contributor lending transactions have risen from the £79.4 million of bridging loans in Q2 of 2020, totalling £115.52 million in the third quarter of the year.
Dominating the sector in Q3 was regulated bridging lending, accounting for an average of 53% of all lending.
The average monthly interest rate in Q3 decreased to 0.78%, from 0.85% in Q2 – back in line with rates available before the current pandemic (0.75%).
Average LTV levels in Q3 increased to 51.7%, from 48.8% in the second quarter. This can most likely be attributed to borrowers turning to bridging finance as maximum LTV restrictions are tightened even more by mainstream lenders.
Gareth Lewis, Commercial Director at MT Finance, said “The stamp duty holiday and rising house prices has ensured that the market remains busy and it has been well publicised that the mortgage market is currently feeling the strain when it comes to delivering acceptable processing turnaround times, which can add to an already stressful experience.
Luckily, bridging finance is a useful tool for brokers to help unlock a transaction for a client allowing them to meet deadlines.
“Given the stress on a chain, presented by the slow processing times, it is unsurprising to see more clients turning to regulated bridging finance to support their purchases.” Original article featured here…
The Bridging Trends infographic showing the general trends that shaped the bridging finance market in Q3 2020 can be found here…