There was a time when bridging finance was expensive and the service standards of some lenders left a lot to be desired. However, as MortgageStrategy.co.uk discussed in a March 2017 article, the situation is now a lot better.
There is fierce competition amongst bringing finance providers and this has kept rates down. Most responsible lenders are members of the Association of Short Term Lenders and abide by its strict code of conduct. This has led to improved customer service levels.
Most mortgage brokers will have a good relationship with a number of bridging lenders and can match the right bridging loan to their client’s individual borrowing requirements.
The range of uses for bridging loans has widened too. The majority of loans are still used for property purchase, but businesses use short-term loans to cover low cash flow periods, buy stock or purchase equipment.
Bridging loans are flexible with loans adjusted to meet borrowers’ needs rather than being subject to strict, rigid rules. There are many specialist lenders that focus on particular loan types, such as loans for people buying property at auctions.
The National Association of Commercial and Finance Brokers is a trade body that educates its members on financial products, including bridging finance. It makes sure that brokers give the best advice to borrowers.
Bridging loans may be a minority sector compared to standard mortgages, but mortgage brokers will recommend one in situations where they are the best solution for their client’s borrowing needs.