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demand pushes mortgage processing time to 16 weeks

According to research from estate agency body, Propertymark, the average time taken from putting an offer in for a property to exchanging has reached between 13 and 16 weeks.

Speaking on the current backlog, Propertymark’s CEO Nathan Emerson said that historically sales typically took six to eight weeks to go through and the increase is likely attributed to the surge in buyer demand on the back of the Stamp Duty holiday deadline, where the property market saw conveyancers, lenders, and mortgage brokers under tremendous pressure.

how a bridging loan can help combat delays

Using a bridging loan to purchase an investment property enables landlords and property investors to access funds quickly, providing an opportunity to expand their portfolio, “bridge” a shortfall when a sale is delayed, or quickly convert properties for the rental market or for profit.

One of the main benefits of a bridging loan is the speed at which funds can be delivered. Where a mainstream bank may take several months to put together a buy-to-let mortgage for a borrower, MT Finance is often able to make lending decisions within hours of initial enquiry and regularly delivers funds in a matter of weeks. This is crucial for those trying to secure quick deals on investment properties.

For example, we were recently approached by a client who required funds to quickly complete the purchase of an investment property in Manchester. They had started the buy-to-let mortgage route, but the process was taking too long, and the transaction was at risk of falling through due to the delays. The clients urgently needed £414,000 or they would lose the opportunity to purchase the asset.

Within a few hours of receiving the initial enquiry, our team instructed the valuation and issued the checklist of legal requirements to the client’s solicitors. The property was inspected by the valuers the next working day, and we received the valuation report within 72 hours.

In just over two weeks, a £414,000 bridging loan was released to the client at 65% LTV of the open market value. Interest was serviced at 0.79% over an 18-month term.

By taking out a bridging loan the client was able to quickly complete the purchase of the investment property. The 18-month term will give them enough time to refinance out of our loan once their buy-to-let mortgage comes through, and as with all our loans, there are no penalty fees if they choose to pay the bridging loan off earlier than the 18 months.

MT Finance bridging loan criteria

Available for residential, commercial, and semi-commercial properties, our bridging loans are available for up to 70% loan-to-value.  With terms of up to 24 months, and no early repayment penalties or exit fees, you have maximum flexibility and the option to repay your loan early without facing any penalties for doing so.

Decisions are made within two business hours and as we are an asset-based lender, we lend solely on the value of the asset and what your long-term plans are. This approach means we don’t need to carry out any credit scoring and adverse credit histories are acceptable.

If you would like more information on how a bridging loan could help secure your next property purchase, simply email us, call 02030512331, or fill out our contact form and a member of the team will be in touch with you shortly.

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