Latest News

As you can tell from my April summary of commercial news things are definitely tough! The commercial mortgage industry is in "free fall".

The largest commercial mortgage lenders show in the north of England was held in Manchester this month. It felt a little surreal? There where exhibitors who have no money to lend, others with small product offers and the show itself has shrunk to a fraction of its normal size. The public speakers from various associations are talking doom and gloom for some time to come!

The largest non status lender (Commercial First) who of course ceased lending back in April announced this month that they are getting £40m from Lloyds and further support from various sources. However, they were also quick to state that this money is to be used to support the business itself and they have no sight of any lending facility within the near future, which is a terrible shame as our industry needs them back in the market as soon as possible.

Here at United Finance we are seeing business coming in but it's becoming increasingly more difficult to place as lenders are diminishing within the market place.

Bridging Loan lenders are more cautious when underwriting and they require too see how the bridge is going to be repaid, making them closed loans. Open bridging loans are now becoming a thing of the past. Its fact that 70% of bridging loans don't exit on time, which of course then goes into default and costs start running away. This doesn't suit the lender or borrower, certainly if the deal is highly geared!

Buy to Let Mortgage lenders have also tightened their belts. There are very few 85%LTV deals available now. The lenders are aiming at professional landlords who can raise deposits of 20 - 25%. There has also been a hike in rates, but looking at it positively I think landlords won't be short of tenants as repossessions increase and people need somewhere to live.