Moreover, there are more bridging products and even lenders for advisers to choose from, which offer everything from straightforward, small-scale bridging loans to large-scale, complex loans that require more than just a template of set rates based on the loan-to-value.
For example, the latest entrant to the market is Bridging lender Octane Capital, which launched on 3 May.
According to Jonathan Samuels, chief executive of Octane Capital, the lender will focus on complex, non-standard and larger loans, and will lend from as little as £100,000 up to £25m, without a focus on the LTV.
The company will not lend based on a series of set rates determined by the LTV.
Instead, each loan application to the new lender will be structured on a highly bespoke basis and priced according to risk, according to bosses.
His colleague Mark Posniak, managing director of Octane Capital, disagrees with lenders focusing on "low margin, high volume lending", pricing on LTV and LTV alone, calling it "a dangerous game that won’t end well.
"Instead we’re going to focus on complex loans, such as large and non-standard loans".
Mr Posniak adds: "Bridging has changed beyond recognition in the past eight years and we sensed the need to change with it."
Six common reasons for bridging
Regardless of these regulatory issues, which demonstrate once again the need for specialist advice to help clients through this interventionist minefield, there are still ways in which bridging can help clients, when traditional mortgage finance does not fit the bill.
Among these, but not limited to, are the following reasons.
1) Auctions
Mr Montlake explains: "If you buy a property at auction, you know you have 28 days normally to complete the purchase. Sometimes that property needs some work doing to it, and a normal mortgage lender might not be able to complete in that time period, or even offer the mortgage at all."
Bridging loans can help cover the financing gap to allow the purchase to go through, before heading to a longer-term lender for more standard finance.
2) Broken chains
As Mr Montlake comments, a client whose property purchase falls through could end up in a broken property chain. They may have a buyer for their property who is pushing for completion, but the clients need to find somewhere else quickly - and mortgages can take weeks to process.
Bridging finance can help the client find an alternative property, buy that and still complete.
