Encouraging figures were published just last week by the Association of Short Term Lenders (ASTL) showing that bridging lending for the 12 months to June passed the £3bn mark for the first time, up from £2.8bn recorded for the same period last year, with applications surging by 56.6% year-on-year.

These positive figures continue: bridging lending hit £875m in Q2 2017, up 12.1% on Q1 2017, with £4.9bn worth of applications received in the period.

Experts believe alternative finance companies and bridging specialists are stepping in to fill the void as mainstream lenders exit the market amid continued uncertainty following the UK’s decision to leave the EU.

•   Demand for bridging finance continues to grow
•   Commonsense decisions are quicker than ever
•   Is it still bridging if it takes 50 days to complete?

But what is equally interesting is why borrowers are taking out bridging loans. According to the latest Bridging Trends survey, the number one reason was to finance refurbishment projects, which contributed to 27% of all lending, as borrowers added value to existing and newly bought properties. Refurbishment was cited ahead of mortgage delays (25% of lending) as the primary purpose of bridging finance for the first time since the survey began in 2015.

This latest analysis suggests the market is changing – and so is the way that brokers can use bridging finance to get the best outcomes for their customers. For example, investment professionals and buy-to-let landlords are looking for short-term loans to allow them to seize an opportunity to buy property in need of refurbishment.

They can use bridging finance as a fast and flexible way to secure funding to buy and ‘do up’ their chosen property, before using a remortgage with a mainstream lender as their exit strategy. Some landlords do this multiple times throughout the year, updating and improving their portfolios and, in turn, providing better-quality homes for an increasing number of private renters.

More lenders are now looking at growing the number of innovative bridging products available to brokers and clients to meet this rising demand from landlords and investors for loans to finance their renovation projects.