Welcome to our new bridging loan blog

Bridging Loans in 2008

Our first bridging loan blog inevitably covers the availability of short term property based loans.

The biggest single factor driving the availability of bridging loans for any particular deal is the quality of the loan exit. Most bridging applicants rely on mortgage re-finance to exit and with 2008 seeing the number of mortgage products reduced by over two thirds then this has had consequences for bridging lenders and what they are able to offer.

Bridging loan to values typically sit below those generally available for mortgages to ensure an exit for the bridging lender. With larger deposits required by many mortgage lenders, bridging lenders reacted by reducing their own loan to value ratios. Increased focus upon the exit means that for many applicants even a mortgage offer can prove insufficient for bridging lenders to offer finance. To successfully apply for a bridging loan the margin between cash required and the lenders maximum loan needs to offer 6 months pre-paid interest.

Submitted by Bridging Loan Broker on Fri, 19/12/2008 - 12:01

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