The bridging finance industry is going through significant changes due to emerging trends and innovative solutions. More people are turning to bridging loans to quickly solve property funding issues. As awareness of bridging loans increases, so does demand, with borrowers and developers using them to grow their portfolios or complete existing developments.
Bridging loans can be beneficial for a range of situations, including heavy refurbishment, chain breaks, re-bridge finance, and auction purchases. According to the latest Bridging Trends data, chain breaks are the most common reason for borrowers to acquire bridging loans, accounting for 22% of all bridging loans taken out in 2023. Investment purchases come in second at 20%. Heavy refurbishments (11%), regulated refinance (10%), unregulated refinance (10%), and other (3%) are also common reasons.
£831 million of bridging loans completed in 2023, which is the highest recorded annual gross lending figure since Bridging Trends launched in 2015. The figure is a 16% increase from the previous year (£716.2m).
Bridging finance has always been a reliable and fast solution for borrowers and investors. Innovative technology is beginning to enhance the way some lenders process transactions. From open banking and data-driven decision-making to alternative credit scoring models, all of these will improve efficiency and enable better risk management.
Avamore Capital has recently announced an increase in the maximum loan size of their bridging finance offering from £7.5 million to £25 million. This move aims to provide innovative solutions to real-time issues that continuously occur in development projects. The increased loan size now offers property developers the opportunity to access more capital to bridge the funding gap.
Avamore’s Larger bridging loans can be ideal for development exit loans. Unlike development finance or other traditional bridging loans, which requires all sale proceeds to repay the loan amount, Avamore will allow borrowers to keep a portion of the sales proceeds. This allows them to control their cash flow during the sales process and move forward with their next project.
Avamore Capital offers Development Exit Bridging Loans tailored to meet the needs of each borrower, with loan terms ranging from 3 to 18 months. This product is suitable for individuals or developers who need to buy a property quickly or acquire a potential development site with planning consent. It can also be utilised when buy-to-let finance is unavailable, or when borrowers need to refinance a completed development facility to release equity for the acquisition of another site.
Avamore Capital is dedicated to providing the best solutions to help property developers overcome setbacks when it comes to starting their next project due to a lack of funds.
