Cheval expects bridging loans rush before A-Day

In the run-up to A-Day, April 5 2006, bridging finance lender Cheval says it expects a rush of borrowers looking to take advantage of the old pension rules for self invested pension plans.

Under the current rules, only commercial property can be included in a SIPP and the maximum amount is 75% of the value of the property. After A-Day, while both residential and commercial properties will be eligible to be included in SIPPs, this will be restricted to 50%.

As a result, Cheval says it expects to see a rush of clients looking to take advantage of the old rules and has set up a specialist unit to deal with all such enquiries.

With commercial property transactions taking longer, it says bridging finance could be a useful way for people to get quick finance and secure the deal. They could then remortgage at a later date.

Paul Rumbold, sales and operations director at Cheval, says: “Unless the purchase is agreed in the next six weeks or so it is unlikely to complete in time using conventional funding. With us, bridging finance can complete in a week – but we have taken as little as 10 hours in the past.

“All applications receive immediate attention from a case manager who owns the client’s file from inception to completion. Our case managers are experienced in carefully guiding applications to completion.

“The clock is ticking and bridging finance will be crucial.”