Alistair Ewing, managing director of The Lending Channel, which provides both advised and non-advised specialist lending, said that bridging is a growing market in Scotland and that there is room for more lenders to gain a presence as product choice is still limited.
“Bridging the gap between traditional property funding, whether it is residential or commercial, with what used to be perceived as a dark world involving loans of last resort, has evolved into a very robust market with more brokers and lenders operating under much improved regulation in Scotland,” said Ewing.
“But lender and product choice is still smaller in Scotland than it is across the border meaning that some lenders don’t operate here at all whereas others, like Precise, only lend in specific postcode areas.”
Ewing added that some lenders do not see Scotland as an important market for them. Although The Lending Channel has 17 active bridging lenders on its Scottish panel, this is heavily weighted in favour of non-regulated lenders, with just six FCA regulated lenders represented, he said.
“It is fairly widely known that there are more lenders looking seriously at a Scottish proposition and in this case more is definitely better,” said Ewing.
“Bridging finance still carries a reasonable degree of risk when compared to mainstream term lending, therefore it is important that client facing advisers understand the market.
“Rates are more expensive than mainstream term lending and with the 3% Stamp Duty being levied for additional property purchases, it is imperative that the broker knows what they are doing – this is not a market for dabblers.”