We are continuing to see signs of increasing completion from and amongst the Challenger Banks, whilst at the same time some of the high street banks however, appear to have reduced their appetite and increased their rates for property based lending.
In the last week, Shawbrook announced their extensive downward re-pricing. Aldermore for several months have been offering a 0.4% discount off most of their products. Interbay have reduced their rates steadily over the last year or so. Overall we see that the Challenger Banks have indeed dropped their rates for commercial property lending over the last 2 years by around 1.5% and can now be obtained from around 3.5% over LIBOR, or around 4.25% all in. (This rate is based on a 55% LTV interest only facility for 10 years) Incidentally this also carried a relatively low debt service cover requirement of c.125% interest cover at 5%.
This contrasts with some of the prime high street banks who have hardened their terms for similar lending. Key have access to the newest and best lenders in the market, so please remember us for any commercial finance including;
- Commercial and Residential Investment.
- Development Finance.
- Commercial Mortgages.
- Corporate Finance.