13 September 2021
We are in a much stronger position than we could have hoped for a year ago but it’s important to keep up the momentum
The latest lending data from the Association of Short Term Lenders presents plenty of reasons to be positive about our sector.
The figures, compiled by independent auditors, show bridging completions totalled £1.1bn in the second quarter (Q2) of 2021, an increase of 23.2% on Q1. Bridging loan books reflect this rise and now stand at more than £4.7bn. Applications fell slightly, by 1.7% to £7.36bn, but applications for the year ending 30 June were still up 26.9% on 2020, representing a strong pipeline of business.
Our lending figures for Q1 2021 showed a worrying trend downwards in terms of application-to-completion conversions. At the time we reported that it took £7.49bn-worth of applications to complete £918m of loans — the equivalent of more than £7-worth of bridging applications submitted to complete £1. Happily, the latest figures show a reversal in this trend, with just £6.63-worth of applications required to complete £1. We expect the situation to continue to improve as confidence is restored to the market.
Confidence is an important factor in loan conversions; not just among lenders, but broker confidence that they will get an affirmative response, making them less inclined to submit multiple applications for the same case. The proliferation of multiple applications can slow lender processes, and therefore conversions.