Bridging Finance Solutions has reported a fourfold increase in short term self-build finance applications during the past year.
The firm said the self-build client profile “sits perfectly” within the wider BFS business model which welcomes the smaller loan applicant, unlike many larger bridging companies or high street lenders.
Typically, clients have a mortgage already in place with limited funds to carry out the build, which is where a bridge becomes imperative.
John Hardman (pictured), head of sales at BFS, said: “The self-builder is a perfect client for us. We have the resources and skills to help this client group who may need additional support from application onwards. Ground-up development and ‘small’ projects (sub £1m) has become a huge part of our operation and this is undoubtedly a space within the marketplace that we will continue to push and explore.”
BFS said that a mortgage company will typically consider a loan following practical completion stage only, when a build warranty certificate has been issued. This makes a mortgage wholly unsuitable for ground-up development work, the point at which BFS provide funding to reach completion. Once this is achieved, the loan is repaid by the mortgage company and the completed property used as guarantee.
Hardman added: “We are living in a media savvy environment where so much information exists on the internet that can make an idea seem more like a real possibility. This notion applies to the property market. Once that idea is there, and the self-builder wants to consider the wider plan, and perhaps most importantly, the finance, we can undoubtedly help make this idea become a reality.”