Surveyors are being extremely cautious
Even where a valuation can be done, surveyors are being very cautious. Whilst they will be producing the usual figures for an open market valuation, 30 day, 90 day and 180 day sale, they may also add a revised figure to allow for the likelihood that prices will fall after the pandemic is over. Some surveyors have even taken to writing, ‘this valuation cannot be relied upon’, on their reports. This makes the report worthless to many bridging lenders, who aren’t prepared to lend on the basis of this type of valuation.
Social distancing causing problems with witnessing legal documents
There are currently problems with getting legal documents witnessed by a solicitor as most are now working from home and not seeing clients face to face.
Staffing shortages are affecting lenders too
Lenders have also been impacted by the requirement for staff to work from home wherever possible and have had to set up systems to allow staff to work remotely.
Staffing numbers have been hit by those needing to self-isolate, which has affected lenders’ abilities to deal with new cases.
Selling your home and buying a new property at the same time can be a little tricky.
It can sometimes take a while to sell your home, leaving you without the sales proceeds to buy your new property.
With a bridging loan, you can avoid the stress of matching up settlement dates, move quickly to buy your new home and give yourself more time to sell your existing property.
A stort-term bridging finance is also known as ‘relocation loan’.
Bridging loans explained: How does it work?
A bridging loan is basically finance that allows you to buy a new property without having to sell your existing property first.
Banks work out the size of the loan by adding the value of your new home to your existing mortgage then subtracting the likely sale price of your existing home.
What you’re left with is your “ongoing balance” or “end debt” which represents the principal of your bridging loan. Banks will assess your ability to make mortgage repayments on this end debt.
Lenders use both properties as security and you’ll have one loan (peak debt) to cover both the existing debt and the new purchase.
Between when your bridging loan is advanced until you sell your existing home, most lenders capitalise interest-only repayments on the peak debt which means that you’ll only have to worry about continuing to make principal and interest (P&I) on your current mortgage, rather than trying to manage repayments on two home loans.
After your property is sold, you simply continue to make normal home loan repayments, plus the compounded bridge loan interest, on the new loan.
Loan and credit card payments to be frozen for three months in UK.
The financial regulator has announced plans to freeze loan and credit card payments for up to three months as part of emergency measures for consumers impacted by the coronavirus outbreak. They have also announced plans to help businesses that are struggling in the current climate.
The new measures which could come into force by 9th April is aimed at consumers and renters who are not benefiting from existing relief measures that have targeted homeowners – with mortgage payment holidays – or business owners.
The FCA has advised that banks and credit card providers will have to ensure that consumer credit ratings are unaffected by any of the measures.
If you are looking for a loan or bridging finance for your business in the agricultural sector. Feel free to give us a call or email us today and we will be happy to help!
Do you aspire to live in the country, where your partner will continue to work and you want to run a smallholding or are you starting a farm business?
Richmond Asset Finance often receives enquiries from customers who want to start a farm and we have the ideal farm loan for this type of scenario, whether short or long term Richmond Asset Finance can help.
Obtaining farm finance can be difficult, especially where accounting information may not be good enough for the banks.
You may qualify for finance on a long-term basis through Richmond Asset Finance, but we also have a great farm selection of loan products that fits the bill for a farm start-up.
What is farm finance?
An all embracing term we use to describe all types of farm and agricultural finance we arrange in the rural and country business sectors, which can also be described as agricultural finance, equestrian finance, land finance and horticultural finance, a farm mortgage or farm loan. Farm finance can be provided for farms of any size (with our without a farmhouse), holiday complexes, caravan parks, caravan sites, estates, land, buildings, working farms, non-working farms, nurseries, garden centres, smallholdings, estates, fisheries, farm shops, riding schools and generally all manner of rural properties or in some cases not so rural.
Why Richmond Asset Finance?
- A well-established and reputable company.
- A great team that will help you with every query you may have.
- Hands on and experienced.
- We work in partnership with our customers to help them achieve their goals.
- References are readily available.
Shoppers across the country British shoppers have been greeted by empty shelves where toilet paper or canned food are usually stocked due to panic and bulking buying.
Shops are now opening earlier to allow elderly to do their shopping and doing their best keep up with the booming demand for certain products like cleaning supplies or toilet paper, but experts say all consumers have a role in making sure basic goods are available for everyone who needs them.
Most economists expect the long term hit to businesses and consumer spending because of COVID-19 will have long-term ramifications for the greater economy and potentially lead to a recession.
The chancellor, Rishi Sunak has unveiled a package of financial measures to shore up the economy against the coronavirus impact.
It includes £330bn in loans, £20bn in other aid, a business rates holiday, and grants for retailers and pubs. Help for airlines is also being considered.