Members of the Association of Short-Term Lenders (ASTL) saw bridging completions reach £470m in Q2 2020, down 56% on Q4 2019.
However, applications increased slightly in the same period.
The data shows that applications increased by just over 1% in Q2 2020, compared to Q4 2019, while loan books showed a small decrease but remain at £4.5bn. Average LTVs increased slightly in Q2 2020 compare to Q4 2019, but continue to remain at sub 60%.
The Q2 2020 figures for the ASTL Data Survey are being compared to Q4 2019 as the Q1 2020 survey was skipped due to Covid-19 and the national lockdown. The survey also found that the value of loans in default showed a small increase of 5.4% over December 2019.
Vic Jannels (pictured), CEO of the ASTL, said: “This was an unusual data survey for a number of reasons and comparing the June 2020 quarter with December 2019 shows a variety of ups and downs. It is difficult to ascertain any real trends at this stage given the impact of lockdown, but at the moment the signs for new business volumes are all positive.
“One area of concern is the value of loans in default, which showed a small increase in Q2. It is uncertain how long the economy will be affected by Covid-19 and it is possible that the situation regarding defaults could worsen, particularly given the enforcement moratorium and delays that lenders are facing with collections activity.”