Why Has There Been a Surge
in Refinancing In 2021?
Refinancing has been a hot topic for the past year, with more and more people realizing the benefits of such financing. This guide will unravel why there has been a surge in refinancing over the past year, diving into the role the pandemic and other factors played.
What Does Refinancing Mean?
Experts Finbri state that, when you’re not yet ready to leave your development finance or bridging loan, but the term is coming to an end, refinancing allows you to complete your project, sell your asset, or get traditional financial resources.
A refinance loan is a type of loan that allows you to settle an existing loan by taking out a new one. There are a number of reasons why you may want to refinance, but the most common is that the original loan term will expire before an exit through sale or extended finance is feasible.
The Recent Surge in Refinancing
Demand for re-bridging has grown considerably in recent years as a result of the COVID-19 epidemic and Brexit, which have left project deadlines highly compressed. This is where refinancing can come in, as when done correctly, it can alleviate pressure and allow projects to go ahead without obstruction.
In the UK, construction timescales have been negatively impacted by labor shortages and material supply constraints, causing many projects to overrun. This added pressure can become quite the costly problem, which is why a lot of people in this situation turn to loans to get them through the challenging period.
Smaller to medium-sized companies, on the other hand, have faced greater difficulties. They may not have as robust a supply chain as bigger developers do. This makes the need for available cash all the more necessary, and with refinancing, they can get the money within a matter of days.
As the above problems are continuing to escalate, even as we appear to be out of the depths of the pandemic, it’s probable that refinancing will only increase in demand. This is interesting news for everyone involved – lenders and businesses alike – providing that it is 100% the right thing to do.
In Summary
People who are thinking about refinancing should speak with a bridging loan provider to get the most out of their investment.
There has never been a better time to go ahead with refinancing, but as mentioned previously, be sure to weigh up the perks and risks so that you know whether it’s right for you. A professional advisor will be able to assist you with this.
