Castle Trust Bank Launches New Bridging Loan Scheme

Castle Trust Bank has rolled out its new ‘Bridge the Gap’ bridging loan product. This strategic financial solution is crafted to assist borrowers who are on the brink of concluding their existing fixed-rate or bridging loans but are wary of locking into a new buy-to-let mortgage due to the forecasted dip in interest rates in 2024.

A Helping Hand for Property Investors

Aimed squarely at property investors who want to establish a robust letting track record before clinching a long-term financing deal, it acknowledges the challenges faced by borrowers, especially when some lenders demand at least a year’s worth of borrowing history to qualify for long-term loans.

Key Features of the ‘Bridge the Gap’ Product

Duration and Interest: The product boasts a 12-month term, allowing borrowers a breathing room to navigate the interest rate landscape with an attractive interest rate of 0.52% per month, summing up to 6.24% annually.
Early Repayment Flexibility: Borrowers can rest easy with the flexibility to repay early, with early repayment charges only being a concern in the first three months of the loan term.
Loan-to-Value Ratio: It offers an enticing up to 75% loan-to-value (LTV) ratio, including the arrangement fee, ensuring borrowers can maximize their borrowing power from the get-go. Even for loans opting for rolled-up interest, the LTV cap remains a generous 75% gross.
Fees Structure: With a 5.5% arrangement fee and the absence of exit fees, the product structure is designed to be as borrower-friendly as possible, minimizing the financial burden on investors.

Anna Lewis, the commercial director at Castle Trust Bank, emphasises the product’s relevance in today’s market, “Bridge the Gap is a product that specifically addresses a growing demand that brokers are seeing for bridging finance that can buy property investors time whilst they wait in hope that rates will continue to fall in the next year. By introducing a 12-month bridge loan with a reduced interest rate, increased arrangement fee and no exit fee, we can provide investors with the flexibility that they need to best manage the rate cycle.”