Lender Changes Bridging Loan Criteria
The bridging loan sector, including the commercial market, is extremely competitive with many lenders providing such finance. Banks and other financial institutions no doubt keep a keen eye on what their competitors are offering so that they can, when felt necessary, adjust some of their lending criteria with a view to attracting new business thus increasing their profitability.
With so many bridging loan products available it can be difficult for a business owner, who is no doubt very busy, to keep up with any changes that a lender makes to its portfolio of lending products. That is one of the benefits in getting in touch with the likes of Commercial Mortgage Link as the specialist that we put you in touch with monitors such changes.
For instance, Aldermore that specializes in providing savings, mortgages and commercial finance to small and medium sized businesses (SMEs) in the UK has recently announced a couple of changes in its bridging loan criteria that some of you looking for such finance may find of interest.
Until recently, an applicant to Aldermore for bridging finance would have had to be at least 25 years of age. However, the bank has now reduced the minimum age to 21 for applicants unless he or she is looking to become a landlord for the first time. This could no doubt help encourage the younger entrepreneur to further increase their investment property portfolio who may otherwise have missed out on an opportunity due to, for instance, a delay in sorting out a commercial mortgage.
Another criteria that Aldermore has amended is to lower the minimum valuation from £100,000 to £75,000 on bridging loans that involve light refurbishment. This decision would mean that bridging finance could be obtained on lower value properties thus encouraging more lending.
It will be interesting to see what sort of impact these changes have on the amount of business in the bridging loans sector. Hopefully, these amendments in Aldermore’s criteria will prove to have a positive effect.