News

Set against the constant change of the previous 12 months, the bridging market has steered a steady course in recent weeks. The ASTL’s lending figures for the first quarter of 2021 showed that bridging completions increased by 10.7% on the same period in 2020 and that the value of loan books was up by 3.5%. Applications are continuing to climb faster than completions, which will be of concern for lenders that are currently underwriting £7 for every £1 that they complete, but the value of loans in default has fallen to just 2.2% higher than in March 2020, so there are plenty of reasons to be positive.
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At the ASTL we always look for opportunities to work collaboratively with our fellow associations in the specialist finance and intermediary lending markets, where it is appropriate to do so for the benefit of our members. This has driven a number of initiatives, such as a joint submission with FIBA regarding the stamp duty holiday and Robert Sinclair from AMI making a presentation at our annual conference.
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New bridging applications achieved £7.49bn in Q1 2021, an increase of more than 25.5% on the same period in 2020.

This is according to the latest figures compiled by auditors from data provided by members of the Association of Short-Term Lenders. The data shows that the value of new bridging applications in Q1 2021 was 12.0% higher than in Q4 2020 and 17.9% higher on the previous year in the 12-month period ending 31st March 2021, reflecting feedback from the market demonstrating increased demand from customers.
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There are so many more parties involved in the bridging process than simply a lender, customer and intermediary. Whether it’s facilitating originations, enabling completions, or supporting collections and recovery, there are many businesses that ensure our industry is able to function effectively and, at the ASTL, we make it our business to understand and educate about the role of those businesses and why they are important.

One question that arose recently was, do we really understand what receivers do? The role of a receiver has actually been around in one way or another for hundreds of years, but it’s one area of the process that I believe is still open to misunderstanding.
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With the arrival of the third national lockdown, and following weeks of campaigning from the property industry, it is looking increasingly likely that there could be an extension to the SDLT holiday, avoiding a cliff edge end to the tax reduction at the end of March.

At the ASTL, we have collaborated with our colleagues at FIBA, to call for an extension to the deadline, and we haven’t been alone. Both IMLA and AMI have also spoken publicly about the need for an extension, as have many specialist lenders, and so it will come as welcome news if measures are taken to avoid a hard end to the window.
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Bridging completions were £2.88bn in 2020, down from £3.99bn in 2019, but applications grew by more than 11% on the previous year.

This is according to the latest figures compiled by auditors from data provided by members of the Association of Short-Term Lenders. The data shows that completions in 2020 fell by 27.9% on 2019 and that bridging loan books dropped to £4.48bn, a decrease of 2.5% on the previous year. The value of applications in 2020 increased to £25.82bn, up from £23.19bn in 2019.
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Bridging applications hit their highest ever level in Q3 2020, and completions rose by more than 40% as the market bounced back from the impact of the first lockdown.

This is according to the latest figures compiled by auditors from data provided by members of the Association of Short-Term Lenders. The data shows that applications totalled £7.6bn in Q3 2020, representing an increase of 39.1% over the previous quarter and an increase of 25.7% on the same period in 2019.
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I had originally written this article prior to the very sad news of the passing of Benson Hersch, who was my predecessor as CEO of the ASTL, a good friend and colleague. I titled the article “Finding strength in adversity” and, if anything that title holds more truth today than it did at the time of first writing.

On behalf of the Board, I can say that Benson is the reason why the ASTL is where it is today. He took the reins of the membership and transformed it into an association that was more representative of the industry, with a clear purpose to improve standards and encourage sustainable growth of the sector. Read more

Bridging finance is designed to provide borrowers with a short-term lending solution until they are able to secure an exit, either through refinancing or sale of the property. But what if things don’t go according to plan and the intended exit is no longer possible when the term of the bridging loan expires?

This year, more than any other, has taught us that even the most robust of plans can be blown out of the water through unforeseen circumstances and the with the door slammed shut on potential exit routes. So, what options does a client have?
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The average completion time for a bridging loan in Q3 of this year was 52, up from 50 days in Q2, and a surprisingly long period for a type of finance that is known for delivering solutions at pace.

This can be very frustrating for brokers and customers, and at the ASTL we endeavour to encourage all lenders to progress cases with speed wherever possible, but also with the highest possible levels of diligence.
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