Bridging loans have their place, says CML
Bridging loans may have suffered from some bad press over the years, but they have their place, according to the Council of Mortgage Lenders (CML).Subject to high entry and exit fees, as well as high rates of interest, bridging loans are designed as a last resort for situations where people may have found their ideal new home, but have not been able to sell their old one fast enough and need to keep their purchase on track. A CML spokesperson said that bridging loans remain "the main and obvious route where there is a mismatch between the purchase of a property and the sale of the former property".However, she advised that they were not a long-term solution and said that borrowers should always have an exit strategy in place. "Entering into a bridging finance contract without knowing what your subsequent rollover strategy is does not make any sense," she warned, adding: "It's down to the circumstances of the case as to whether they're appropriate to a person's needs or not."
Share this..
Related stories
Lack of knowledge discourages potential investors, says AIC
Potential investors are being deterred from investing in the stock markets by a lack of understanding, according to research from the Association of Investment Companies (AIC).The AIC found that 32 per cent of those polled said that they did not understand enough about the stock market to feel confident enough to invest in it, while nearly a quarter were put off because they did not know how to go...
Read MoreWhat Is An Underwriter? (Part One)
Underwriters are very common in investment markets especially stock markets and insurance markets although the specific role of the two does differ. In affect an underwriter will take some of the risk from a share issue or other financial transaction in return for a commission (payment).
Stock Market Underwriter
When a company is looking to raise funds for expansio...
Barclaycard wakes up to the UK recession
It has been revealed that Barclaycard, under pressure from the UK government, will introduce an interest rate freeze and possible reduction for 12 million customers. Interest rates in general will be frozen until June at the earliest but some 3 million of the company's low risk customers could see their rates fall by between 2.4 and 5 percentage points. The move comes at a time when credit card co...
Read MoreIreland Set To Enter Recession
After experiencing one of the longest periods of sustained growth in its history it seems that Ireland is on the verge of a recession with reports that the economy will shrink by 0.4% during the remainder of 2008. When you consider that countries such as Ireland, which has experienced substantial growth and inward investment over the last 20 years, are on the verge of recession the signs do not b...
Read MoreUK businesses hit back
While there is no doubt that friction between the UK banking sector and UK businesses continues to grow, a group of three local businessmen literally took the matter into their own hands this weekend. It was reported that angry campaigners bricked up the front door of a Barclays Bank branch in Bournemouth attracting massive support from passing motorists and pedestrians. The men in question are...
Read More