According to recent data compiled by MT Finance from a number of their key introducers including impact packaging, for the second consecutive quarter, the most popular use of a bridging loan was to fund a chain-break, contributing to 20% of all loans in Q1 2021, down from 23% during Q4 2020.
Purchasing an investment property was the second most popular use for bridging finance in Q1, falling to 19% of all lending, from 21% in the previous quarter. The data highlights how bridging finance continues to be an increasingly attractive proposition to buyers who are looking to save their delayed property purchases.
Regulated bridging loans transacted by contributors remained unchanged from the previous quarter, at 48% of total lending. Meanwhile, second charge transactions remained at 22% of market share in Q1 2021.
The average weighted monthly interest rate in Q1 2021 was 0.74%. This was marginally higher (0.02%) than in Q4 2020, and still considerably cheaper than rates offered before the Covid-19 outbreak (0.80%).
The greatest shifts in Q1 2021 were the average loan-to-value (LTV), rising to 55.2%, from 51.3% in the previous quarter. This could be attributed to the increase in availability of higher LTV products over recent months, in response to borrower demand.
The average term of a bridging loan climbed by one month to 12 months, falling in line with the same quarter in 2020. Whilst the average completion time on a bridging loan application increased to 53 days in the first quarter of the year, up from 50 days in Q4 2020.
Why use impact packaging for bridging?
Bridging can be arranged on a regulated or non-regulated basis. We have a dedicated bridging team who are experts in their field and are there to help with your bridging and short term lending enquiries.
Speak with the impact bridging team today on 01403 272625 or email bridging@impactsf.co.uk to find out more
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