The future of short-term loans in the UK

We believe that the future of UK short-term loans is bright.  Lenders who are able to adapt to the changing property market and offer competitive rates and terms will be well-positioned to succeed in the future.

Economic outlook

The UK economy is expected to grow at a steady pace in the coming years.   This will create demand for short-term lending to businesses and consumers.   The Office for Budget Responsibility (OBR) has forecast that the UK economy will grow by 3.2% in 2023 and 2.1% in 2024.  Therefore, this growth will create jobs and boost consumer spending.  Combined this will lead to increased demand for short-term finance.

Interest rates

The rising interest rates are expected to have a mixed impact on short-term loans and the overall economy in the UK.   Specific impact will depend on how the Bank of England manages the rate hikes and how businesses and consumers respond to the higher borrowing costs.  Interest rates are expected to peak between 5.75%-6% by the end of 2023 or start of 2024.

Demand for property

The demand for property is expected to exceed supply in the coming years, which will create opportunities for lenders. The UK housing market is currently experiencing a shortage of properties, which is driving up house prices. This demand will lead to increased rents.    Therefore, making short-term loans more attractive to investors who want to purchase rental properties.

Increasing automation and caution amongst the big banks

The big banks in the UK are increasingly automating their lending processes and becoming more cautious about lending money.  This is due to a number of factors, including the rise of fintech companies, the increasing risk of defaults and regulatory scrutiny.  The big banks’ caution is creating an opportunity for short-term lenders, who are able to offer more flexible and personalised lending solutions.

Opportunities for lending

Lenders can help investors and buyers make the most of quick access to flexible funding.   For example, Alternative Bridging Corporation can provide short-term bridging loans to investors who need to purchase a property quickly.  Also, in addition, we can provide revolving lines of credit to businesses that need to cover short-term expenses.

How we can help investors and buyers in the UK

• A property investor can use short-term finance to purchase a property that is currently on the market. This can be helpful if the investor needs to close on the property quickly, or if the investor does not have enough cash on hand for the down payment.

• A homebuyer can use a loan to cover the cost of a down payment or closing costs.  Helpful if the buyer does not have enough savings for the down payment, or if the buyer wants to close on the property quickly.

• A business can use short-term loans to cover immediate day-to-day expenses, such as payroll or inventory.   Particularly useful  if the business is experiencing a temporary cash flow crunch, or if the business wants to take advantage of a new opportunity.

Flexible lending can be a valuable tool for investors and buyers in the UK who need quick access to funding.   Lenders who are able to understand the needs of their clients and offer competitive rates and terms will be well-positioned to succeed in the future.

If you are looking for a short term loan, consider Alternative Bridging.  Our loans offer flexible repayment terms.  In addition, we have a great reputation for customer service too. Check out our Google reviews