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Buying more certainty with bridging finance…

By Claire Kotzé | 17 August 2020

SUMMARY: Claire Kotzé, Specialist Lending and Events Manager at Market Harborough Building Society explains how bridging finance could be your clients’ best option to buy their new home or raise capital during the current climate.

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Are you ready to act when bridging finance could be your clients’ best option to buy their new home or raise capital during these challenging times?

Bridging could be the solution to keep your clients’ property chain moving with the uncertainty we continue to face in 2020. Providing the funds to buy their next home before they’ve sold their current one and with no monthly repayments, it offers many benefits:

  • it removes the need to wait for a buyer to complete a property chain, and in turn reduces the risk of a property chain breaking
  • it can be used to fix a broken property chain; and
  • it puts your clients in the best position to act quickly to buy their next home, effectively becoming cash buyers which is more appealing to sellers.

Stamp duty holiday impact

The temporary reduction in Stamp Duty Land Tax (SDLT) announced by the Chancellor in July, means that some existing purchases are being pushed through faster, or homeowners have brought forward plans to move home.

We are seeing more people using bridging to purchase a holiday home for staycations, and landlords who are looking to extend their property portfolio especially as second home purchasers also benefit from the reduction in SDLT.

Where time is of the essence bridging can provide the funds to complete the purchase quickly.

Bridging finance scenarios

Bridging finance can provide the right solution to bridge the gap during a purchase, for example before your clients’ property sells or their standard mortgage application completes.

Other scenarios include downsizing, building a property, completing an existing development or refurbishing a house, all before your clients need to move in.

The finance lasts around 12 months, sometimes longer. No monthly payments are needed and your client can choose to roll up the interest or make regular payments. There are usually no early repayment charges.

Bridging finance solutions from MHBS

We provide regulated bridging finance for your clients, including those with complex scenarios, and consider unregulated applications where they involve residential property. We also offer the facility to re-bridge from another lender.

For HNW clients we can provide bridging terms up to five years and added flexibility.

Our bridging finance can be used to raise capital for many reasons:

  • downsizing
  • building a property
  • completing an existing development or refurbishing a house
  • extending a lease
  • funding gifts for family or friends
  • an acceptable business purpose

Our Bridging Team will work with you to find the right bridging solution and you'll have access to a Specialist Bridging Underwriter. Our daily credit committee means we provide fast and reliable decisions. Our first class service is endorsed by our five-star Feefo rating from intermediary partners.

We can lend £200k to £3m to a maximum age of 85 and no affordability assessment is needed for rolled up loans.

Security options

We can use any type of residential property as security:

  • Main home or new home
  • Second home
  • Buy to let
  • Holiday let
  • Houses with land, an annexe or a commercial element
  • Listed buildings

Exit strategy examples

We also consider various options for repaying the loan including investments, pension maturity and sale of other properties (including those abroad).

To find out more about our bridging solutions, call our Bridging Specialists on 01858 412617 or 01858 412408.

For more information about our Intermediary Service, visit mhbs.co.uk/intermediaries.

For intermediaries only

Claire Kotzé is Specialist Lending and Events Manager at Market Harborough Building Society