Bridging finance does as it sounds and reads on the tin; it bridges that gap between the ‘might be possible’ and ‘yes it does fit our lending criteria’. It will of course mainly benefit the property developer and those clients who wish to move house and cannot match up the dates of completion between a sale and purchase.
However, over the last few years we have seen a massive increase in choice with over fifty lenders now offering short term and bridging finance to enable the wheels of property purchase to carry on turning. What the short term lenders now insist on is an exit route to ensure they are not carrying large numbers of clients who have taken a short term deal in the hope that the market will change hoping commercial mortgages and finance will pop up from their High street bank helping them refinance away from the more expensive short term arrangement.
In an ideal world bridging and short term finance should be exactly that, short term. This market has however has been a lot tougher than some clients may have thought it would be and have gambled on a magic exit route becoming available. Confidence has to return to our markets before we can expect to see the High street banks opening up their doors to welcome us in, rather than the clients having to seek the secret code numbers to open the banks vault doors.
Having the exit route with commercial mortgages and finance in place for clients who have done their sums and have a good history of making re-repayments of their loans and mortgages on time is essential if we want to grow out of the dark place anytime soon.
As our Government have put so much of our money into our High street banks, to save them from going bust, it would not be unreasonable for them to now show the same level of concern to our businesses to enable them to trade their way out of this current situation.
Some businesses will not survive of course, but there are many who could and should survive, because without them and the many businesses who want to start up our unemployment queues will grow. Commercial mortgages and finance are the very life blood of business, Count Dracula has been around far too long, we now need the transfusion of accessible banking and finance to go forward and build a new tomorrow, before we all become vampires.
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