Tuesday, 13 December 2016
A need for fast, reliable and transparent liquidity to help service the 5.5 million private sector businesses in the UK is as critical as ever. However, many businesses are still in the dark about the full range of funding options available to them.
According to a report published by Close Brothers Group, nearly half (46%) of SMEs have experienced barriers in accessing finance. The report highlights how this poses a significant challenge to the SME sector, especially as a large number (38%) of SMEs only turn to high street banks for information and advice on suitable types of finance.
Bridging loans are increasingly becoming a critical tool for funding the SME community, as they are able to offer innovative financing solutions, tailored to each individual business’ needs.
One of the biggest selling points of bridging finance is the flexibility the product can offer, compared to mainstream lending.
As an example, MTF was approached by applicants looking for £649,000 to purchase their business premises. The clients had been given a good deal by their vendor, but needed to act very quickly.
With only three weeks to complete the purchase, the borrowers approached MTF, as their mortgage provider was unable to complete within the tight timescale.
In just two weeks, MTF was able to provide a £649,000 bridging loan, secured by way of second charge, at 59% loan-to-value, over the clients’ residential property.
By taking out a bridging loan, the clients were able to obtain the funds needed to complete the purchase of the premises, where they had operated their business for over 25 years.
There are an array of instances where bridging finance is the ideal solution for SMEs needing quick access to funds, or to plug a gap that traditional lenders are unable to fill. Whether funds are needed to acquire stock, to facilitate a new venture or to provide additional capital to stimulate growth, bridging finance can help.
In an uncertain climate, it has never been more important for business owners to gain a broad familiarity with the full range of financial tools available to them. At MTF we welcome second charge applications and are actively looking to provide liquidity to the SME sector.
Tomer Aboody is a founding directore of MTF. With over 20 years' experience in the property market, both in the UK and abroad, he brings first-hand understanding to the property finance sector. Tomer is the driving force behind MTF's asset-based lending approach and commonsense attitude to underwrting a bridging loan.
MTF is a leading bridging finance lender specialising in short term loans including auction finance and bridging loans, on both a first and second charge basis, and is recognised throughout the industry for its speed and service.
Established in 2008, the company has won multiple awards including Best Bridging Finance Provider at the Business Moneyfacts Awards 2016, Service Excellence Award at the Bridging & Commercial Awards 2015 and Best Service from a Bridging Finance Provider at the Business Moneyfacts Awards 2014. It was named ‘Short-term Lender of the Year’ by the NACFB in 2014.