blog mortgage118

Tag: Bridging Loans

  • Hope Capital Expands Bridging Criteria in Mortgage Market

    Hope Capital Expands Bridging Criteria in Mortgage Market

    Hope Capital Property Finance has broadened its bridging loan criteria, making it easier for borrowers to access funds. This expansion is significant for landlords, investors, and brokers as it enhances flexibility and affordability in the current mortgage market.

    TL;DR: Hope Capital now allows lending on below-market-value transactions up to 75% of open market value; the minimum loan size has been reduced from £100,000 to £50,000, benefiting a wider range of borrowers.

    What are the new criteria changes?

    The lender has introduced several key changes to its bridging loan offerings. Notably, it has increased the lending limit on below-market-value transactions to 75% of the open market value, contingent on a full valuation. Additionally, the instant valuation threshold has been raised from £500,000 to £1 million for qualifying residential cases, which is expected to expedite completion times.

    How do these changes affect borrowers?

    With the reduction of the minimum loan size from £100,000 to £50,000, more borrowers can now access bridging finance, especially those looking to invest in smaller properties or undertake refurbishment projects. The enhanced offerings include loans ranging from £50,000 to £5 million across England, Wales, and Scotland, with terms available from three to 18 months.

    What does this mean for brokers?

    Brokers can now offer a more competitive range of products to their clients, particularly in the specialist property market. The dual legal representation threshold has also increased from £750,000 to £1 million, allowing brokers to facilitate larger transactions without the need for separate legal representation, thereby simplifying the process.

    What this means for the mortgage market

    The adjustments made by Hope Capital reflect an ongoing trend in the mortgage market towards greater accessibility and flexibility. By catering to a broader spectrum of borrowers and reducing costs associated with bridging loans, lenders are positioning themselves to meet the evolving needs of the property market. This could lead to increased activity in the sector as more investors and landlords take advantage of these favourable conditions.

    Frequently asked questions

    What types of properties can benefit from these new criteria?

    Residential properties, including those requiring light, medium, or heavy refurbishment, are eligible under the new criteria.

    How can I apply for a bridging loan with Hope Capital?

    Interested borrowers should contact a broker or directly reach out to Hope Capital to discuss their specific needs and the application process.

  • Somo Bridge Facilitates Below-Market Buy-to-Let Deals

    Somo Bridge Facilitates Below-Market Buy-to-Let Deals

    In a recent development, Somo has introduced a bridging solution that enables investors to acquire properties at below-market prices, presenting a unique opportunity in the buy-to-let sector. This innovative approach allows landlords to use their main residence to secure financing for profitable investments.

    TL;DR: Somo’s new bridging facility allows investors to purchase a £500,000 property for just £350,000; this creates immediate equity and a pathway to long-term buy-to-let financing.

    How Does the Somo Bridging Facility Work?

    Somo structured a facility that uses the borrower’s main residence as collateral, enabling the purchase of a property valued at £500,000 for only £350,000. The vendor needed a quick sale due to an overseas relocation, which allowed the buyer to negotiate a significant discount. An independent valuation confirmed the property’s market value, ensuring that the reduced price was due to the seller’s circumstances rather than any issues with the property itself.

    What Are the Benefits for Buy-to-Let Investors?

    This bridging solution not only clears existing mortgage arrears but also releases enough capital to fund the purchase, creating substantial equity from day one. This immediate equity positions the investor to refinance onto a long-term buy-to-let mortgage, enhancing their investment strategy and cash flow potential.

    What This Means for Landlords and Borrowers

    For landlords and potential borrowers, this development signifies a shift in how financing can be approached in the buy-to-let market. The ability to acquire properties below market value opens doors for investors looking to expand their portfolios. It also highlights the importance of understanding the conditions under which such opportunities arise, particularly the seller’s urgency.

    Frequently asked questions

    How can I benefit from a bridging loan?

    A bridging loan can provide quick access to funds for property purchases, allowing you to take advantage of time-sensitive opportunities, such as below-market deals.

    What should I consider before using a bridging loan?

    Consider the costs associated with bridging loans, including interest rates and fees, and ensure you have a clear plan for refinancing or repaying the loan.

  • UK Mortgage Market Sees Significant Q1 Decline

    UK Mortgage Market Sees Significant Q1 Decline

    The UK mortgage market is experiencing a notable slowdown, as recent data reveals a significant drop in bridging completions and applications during the first quarter of 2026. Completions fell by 28% to £1.8 billion, while applications decreased by 15% to £9.9 billion, highlighting a cautious approach from lenders amidst economic uncertainty.

    TL;DR: Bridging completions dropped 28% to £1.8 billion and applications fell 15% to £9.9 billion in Q1 2026; this cautious lending climate affects landlords, borrowers, and investors.

    What is Driving the Decline in the Mortgage Market?

    The decline in the bridging and development finance market can be attributed to various economic factors that have influenced lender confidence. The overall mortgage market has faced challenges over the past year, leading to a more conservative lending strategy. Lenders have reduced average loan-to-value (LTV) ratios from 58.64% in Q4 2025 to 56.64% in Q1 2026, reflecting a heightened risk assessment.

    How Are Different Segments of the Mortgage Market Affected?

    Development lending has seen a particularly sharp decline, dropping 34% to £276.5 million compared to £420.3 million in the previous quarter. Additionally, second charge lending decreased by 10%, falling to £131.3 million from £145.8 million. These figures indicate that both new developments and refinancing options are becoming less accessible, which could impact property investment and growth strategies.

    What This Means for Borrowers and Investors in the Mortgage Market

    For landlords and property investors, the slowdown in bridging completions and applications signals a tightening of available finance options. Those looking to secure funding for new projects or refinancing existing properties may find it more challenging, as lenders adopt a more cautious stance. This could lead to increased competition for available loans, potentially driving up costs or limiting access for some borrowers.

    What Should Stakeholders Watch Next in the Mortgage Market?

    Stakeholders in the mortgage market should monitor ongoing economic conditions that may further influence lender behaviour. As the market adjusts to these changes, it will be essential for borrowers and investors to stay informed about shifts in lending criteria and market sentiment. Keeping an eye on the latest current mortgage rates and trends will be important for making informed financial decisions.

    Frequently asked questions

    What are bridging loans and how do they work?

    Bridging loans are short-term financing options used to ‘bridge’ the gap between the purchase of a new property and the sale of an existing one. They are typically used by property investors and developers to secure funding quickly.

    How can I find the best mortgage rates in the current market?

    To find the best mortgage rates, consider using a mortgage rate comparison tool. This allows you to evaluate different lenders and their offerings, ensuring you secure the most competitive rate for your needs.

  • GB Bank Launches New Buy-to-Let and Bridging Range

    GB Bank Launches New Buy-to-Let and Bridging Range

    GB Bank has introduced a new range of buy-to-let (BTL) and bridging loans, providing fresh options for landlords and property investors. This move is significant as it expands the lending market, offering competitive rates and flexible terms that can benefit both brokers and their clients.

    TL;DR: GB Bank’s new BTL range features fixed rates starting at 4.94% for loans between £500,000 and £3m; brokers can access a 0.75% fee, enhancing opportunities for landlords.

    What are the details of the new buy-to-let range?

    The newly launched core BTL range at GB Bank includes fixed rates for two, three, and five years, with loan-to-value (LTV) options between 65% and 75%. Rates commence at 4.94%, and loans are available from £500,000 up to £3 million. Additionally, brokers will incur a 0.75% procuration fee, which may influence their choice of lenders.

    How does the bridging range compare?

    GB Bank’s bridging range starts from 0.79% per month for residential properties and 0.99% for semi-commercial properties, with maximum LTVs set at 75%. Notably, there is no minimum income or UK property ownership requirement, making it accessible for a wider array of borrowers. Bespoke loans are still available for amounts up to £20 million for qualifying cases.

    What this means for landlords and brokers

    The introduction of this BTL and bridging range is particularly relevant for landlords looking to expand their portfolios or refinance existing properties. The competitive rates and flexible terms can offer significant savings and improved cash flow. Brokers, on the other hand, can use these new products to meet diverse client needs, enhancing their service offerings.

    Frequently asked questions

    What types of properties can I finance with these loans?

    The BTL range is suitable for residential investment properties, while the bridging loans can apply to both residential and semi-commercial properties.

    Are there any specific eligibility criteria?

    For the BTL loans, borrowers must meet the lender’s criteria, including creditworthiness. The bridging loans have no minimum income or property ownership requirements, broadening access for potential borrowers.

  • GB Bank Joins BDLA as New Lender Member

    GB Bank has officially joined the Bridging and Development Lenders Association (BDLA) as a lender member, marking a significant milestone for both the bank and the association. This addition brings the BDLA’s total membership to 55 lenders, collectively managing a loan book exceeding £13 billion. The BDLA continues to expand its influence within the specialist property finance sector, enhancing its capacity to advocate for sustainable growth and professionalism.

    Strengthening the Specialist Finance Sector

    Adam Tyler, CEO of the BDLA, expressed enthusiasm about GB Bank’s membership, stating, “We are very pleased to welcome GB Bank to the BDLA as a Lender Member. The Association continues to grow in both scale and influence, and the addition of another ambitious, solutions-led lender further strengthens our collective voice across the specialist property finance market.” This growth is crucial as the BDLA aims to support its members in navigating the complexities of the bridging and development finance landscape.

    GB Bank’s Commitment to the Industry

    Eddie Trahearn, CEO of GB Bank, shared his excitement about joining the BDLA, noting, “We are delighted to join the BDLA as a Lender Member and to become part of an association that plays such an important role in supporting and representing the bridging and development finance sector.” This partnership signals GB Bank’s commitment to contributing positively to the industry, ensuring that it adheres to the highest standards of transparency and professionalism.

    Impact on Borrowers and the Market

    The inclusion of GB Bank in the BDLA is expected to enhance competition within the bridging finance sector, which could lead to more favourable terms for borrowers. With the current UK base rate at 3.75% as of April 2026, borrowers may find more innovative financing solutions tailored to their needs as lenders like GB Bank seek to differentiate themselves in a competitive market. This is particularly relevant for those considering bridging loan rates as they explore short-term financing options.

    As the BDLA continues to grow, its members will likely play a pivotal role in shaping the future of property finance in the UK, advocating for practices that benefit both lenders and borrowers alike.

  • InterBay and Together Reduce Commercial and Bridging Rates

    InterBay and Together Reduce Commercial and Bridging Rates

    InterBay Cuts Commercial Rates

    InterBay has announced significant reductions in rates for its commercial investment and semi-commercial limited-edition products. The lender has lowered the rates on its two-year fixed products by 0.5% and its five-year fixed products by 0.2%. Marc Callaghan, head of commercial lending at InterBay, emphasized that these adjustments reflect their commitment to supporting brokers and clients in a rapidly evolving market. By reducing rates by up to 50 basis points across limited-edition products, InterBay aims to facilitate smoother deal structuring and enhance outcomes for investors.

    Together Lowers Bridging Rates

    In a similar move, Together has reduced rates across its unregulated bridging products by 0.05%. This adjustment is designed to improve affordability for borrowers at higher loan-to-value (LTV) tiers. The unregulated bridging products are available for loans ranging from £26,000 to £5 million, providing dual solicitor representation on qualifying cases and offering 100% funding, subject to additional checks. The starting rates for first charge unregulated residential bridging are now at 0.9%, while semi-commercial and commercial properties are at 1.04% and 1.08%, respectively. For second charge unregulated residential bridging, rates start from 1.08%, with semi-commercial and commercial rates at 1.06% and 1.1% respectively.

    Practical Impact on Borrowers

    The recent rate cuts from InterBay and Together are likely to have a positive impact on borrowers looking for commercial and bridging finance. For instance, a property investor considering a £500,000 semi-commercial property could see significant savings on their mortgage payments due to these reduced rates. With the UK base rate currently at 3.75%, these lower rates can enhance cash flow and make property investments more attractive. The focus on affordability and flexible lending options is crucial for brokers, investors, and landlords navigating today’s lending landscape.

    Market Context

    These rate reductions come at a time when the UK property market is experiencing fluctuations influenced by economic factors such as inflation and interest rates. The Bank of England’s base rate, currently at 3.75%, has been a critical consideration for lenders and borrowers alike. As lenders like InterBay and Together adapt their rates, they are responding to both market pressures and the need to remain competitive. This adaptability is essential for attracting investors who are keen on capitalising on opportunities in the commercial and bridging sectors.

  • Together Slashes Unregulated Bridging Rates: What it Means for Borrowers in 2026

    Together Slashes Unregulated Bridging Rates: What it Means for Borrowers in 2026

    Specialist property lender Together has announced a 0.05% rate reduction across selected unregulated bridging products as of 8 May 2026. This strategic move is aimed at enhancing affordability, particularly at higher loan-to-value bands, and offers a significant shift for borrowers and investors alike.

    Rate Reductions in Detail

    Together’s headline first charge rates now start from 0.90% for unregulated residential bridging, 1.04% for semi-commercial, and 1.08% for commercial properties. Second charge headline rates now start from 1.08% for residential bridging, 1.06% for semi-commercial, and 1.10% for commercial properties. These products are available on loans between £26,000 and £5m, with up to 100% funding available with additional security.

    Impact on Residential Borrowers

    For a homeowner with a £500,000 unregulated residential bridging loan at 75% LTV, this rate cut reduces monthly payments from £3,750 to £3,562.50 — a saving of £187.50 per month or £2,250 per year.

    Impact on Commercial Property Owners

    A commercial property owner with a £1m semi-commercial bridging loan sees their monthly cost drop from £10,400 to £10,040. This equates to a monthly saving of £360, or £4,320 annually.

    Impact on First-Time Buyers

    Consider a first-time buyer with a £300,000 unregulated residential bridging loan at 90% LTV. With the new rate cut, their monthly payments would decrease from £2,250 to £2,160, leading to a monthly saving of £90, or £1,080 per year.

    Market Context

    These rate reductions come at a time when the UK base rate stands at 3.75% as of April 2026. Compared to the base rate six months ago, which was 3.5%, the current rate indicates a rising trend. In this context, Together’s rate cuts provide a competitive edge in the bridging loan rates market.

    Comparison to Previous Rates

    Compared to a year ago, when the rates for unregulated residential bridging loans were around 1.2%, the current rates represent a significant reduction. This means that borrowers can now access cheaper financing options for their property investments.

    Direction of Travel

    Given the current upward trend of the base rate, the rate cuts by Together offer a counterpoint. This move could potentially trigger a competitive response from other lenders in the market.

    Year-on-Year Review

    Looking back over the past 12 months, the base rate has increased by 0.25%. Despite this, Together’s rate cuts represent a significant reduction in the cost of borrowing, underlining their commitment to affordability and flexibility for their customers.

    Frequently Asked Questions

    What are the new rates for unregulated bridging loans?

    The new rates start from 0.90% for unregulated residential bridging, 1.04% for semi-commercial, and 1.08% for commercial properties.

    How much can I save with the new rates?

    For a £500,000 residential bridging loan at 75% LTV, you could save £187.50 per month or £2,250 per year. For a £1m semi-commercial loan, the savings could be £360 per month or £4,320 per year.

    What is the current base rate?

    The current Bank of England base rate is 3.75% as of April 2026.

    How do these rates compare to a year ago?

    Compared to a year ago, when the rates for unregulated residential bridging loans were around 1.2%, the current rates represent a significant reduction.