London-based property finance firm, Finanze, has partnered with lender, Albatross Capital, to launch a ‘serviced’ bridging loan that enables foreign investors to build up a robust UK credit profile and have a far greater chance of securing better rates in the future.
Serviced bridging loans are rare and are generally not offered to foreign nationals, as they typically require a strong credit report and local income. The latter requirement represents a Catch-22 for foreign nationals, especially those buying their first property.
While the vast majority of bridging loans use retained or rolled interest, which is paid back in full at term in one single payment, serviced bridging loans require monthly interest payments, which amplify a borrower's creditworthiness as there are multiple payments rather than simply one.
This gives foreign national borrowers a far greater chance of securing more competitive lending rates in the future from a wider pool of lenders when it’s time to refinance.
Finanze founder, Alastair Hoyne, commented:
Finanze is proud to bring this product to market with Albatross Capital. If they lack a track record of buying and selling in Britain, most foreign nationals either have to buy in cash or take out buy-to-let mortgages at punitive interest rates. We have created a product that circumvents this problem. This loan enables foreign nationals to create a healthy credit history that opens up access to a much larger pool of lenders in future, significantly improving their financing options long-term."