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Renaming bridging loans would boost understanding

As outlined in a recent column (Mortgage Strategy February 26), Andy Moody deserves strong industry support for his campaign to rename bridging loans ‘short-term funding’. This describes the most important function of such loans much more accurately.

Perhaps even better would be ‘express short-term funding’ because the fast delivery of funds is just as important as the length of the loans – especially when loans are needed to purchase properties in deals that are intended to make borrowers a profit but which mainstream lenders would not consider.

Normal examples cited include dev-elopment properties, those bought at auction and buy-to-lets. Many more could be added including buying undervalued properties in quick transactions, buying land to build on, re- financing to raise capital for buying other properties and investing in commercial ventures.

Less than 20% of our business is in the traditional area of residential property sales and purchases where borrowers need short-term funds to buy new properties.

The growth area is in entrepreneurial property dealings whereby the availability of short-term funds needs to match borrowers’ needs for fast delivery, transparent terms and no onerous tie-ins.

Once brokers understand the power of short-term funding they will greatly increase their capacity to turn client enquiries into sales.

One minor correction – Moody says rates on short-term funding start from 1.4% monthly. This is incorrect as our rates start from 0.75% monthly.

John Maclean
Managing director
Link Lending
By email


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Dear Delia

Dear Delia, one of my clients is attempting to remortgage one of the buy-to-let properties in his portfolio. The property is 150,000 and his portfolio is 1m. He bought this property speculatively about three years ago and the rent only just covers the mortgage. At today’s interest rates, he is going to face a serious problem. Do you have any suggestions? Delia says: Your client has a number of options available to him as Brian Murphy of Mortgage Advice Bureau and John Heron of Paragon Mortgages, point out.

Have you got a problem for Delia? Email

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