The importance of the exit in bridging finance cannot be overstated. It is fundamental to the success of an application and needs to be monitored for viability purposes throughout the course of the project – especially in the current economic climate.
We have written in the past about the need for contingencies but it’s worth reiterating the message that brokers must ensure their clients possess several exit strategies for their bridging loan cases. The deteriorating economic climate and decelerating property market have rendered 'plan A' less reliable, making it crucial to establish 'plan B' and even 'plan C.'
From our experience at London Credit, we believe that the property investment market is still buoyant. With new home purchases relatively low, the private rented sector is standing firm.
Business owners will time and time again state that certainty is a key consideration. What they don’t want are constant changes in regulation or tax regimes amongst other things.
I often feel that financial services are a sector that suffers from an overuse of abbreviations and acronyms more than most. For example, I’ve already used three TLAs (three-letter acronyms) this morning – LTV, OMV, ICR – and it’s not even 9 am.
Looking back on the year, it’s hard to avoid the conclusion that things are tougher all around for everyone. The most recent Bank of England Monetary Policy Committee meeting saw yet another hike in rates, this time to 3.0%.
When you’re in the middle of a crisis, it’s sometimes hard to imagine that it will ever end. However, all things do pass, and it’s well worth reminding oneself of this sentiment, especially when in the midst of political and economic turmoil, such as we face today.
