The value of bridging loans being applied for in 2014 rocketed by 63% to £2.27 billion, according to the Association of Short Term Lenders (ASTL).
The organisation points out that the value of applications can tend to be volatile when analysed on a quarterly basis but they say the outlook for this year is ‘positive’.
The value of applications rose by 12% between Q2 and Q3 last year and again by 20% from Q3 to Q4.
Bridging loan book leaps in value
The ASTL says that the value of its members’ bridging loan book leapt by 54% year-on-year.
The organisation’s chief executive, Benson Hersch, said there was increasing uncertainty about the political outcome of the upcoming General Election and this could cause a ‘bumpier ride’ in the months afterwards.
He added: “Bridging is established as a valuable source of finance with intermediaries seemingly more aware of the benefits and are happier recommending bridging loans.
Bridge loan firms are ‘responsible’
“Our members are responsible and provide a reliable and responsible bridging service for homeowners and SMEs.”
The figures quoted by the ASTL refer only to their members, many are the key bridging loan lenders in the market, and they do not reflect the wider bridging lending sector as a whole – though they are fair indication of just how well the sector is doing.
Amicus – the new name for Capital Bridging Finance
Meanwhile, a desire to move into other financing areas has led to well-known short term lender Capital Bridging Finance changing its name to Amicus.
The move reflects the rapid growth of the business since launch five years ago, it trebled in size last year, and the new firm will deliver £150 million of new lending this year.
The firm’s managing director, Keith Aldridge, said: “The new name reflects our progress to extend our offering beyond bridging loans into development of other short-term lending types.
Amicus will extend reach from bridging
“This also gives us some flexibility in building on our proposition to deliver the same customer focus in other specialist lending markets.”
The company has been on the buyout trail in recent months, it bought Preston-based Mayfair Bridging and has recently bought Norton Folgate, the asset leasing and finance company which specialises in property, vehicle, marine and air finance.