According to public data by the Intermediary Mortgage Lenders Association (IMLA), and despite the economic effects of the pandemic on SME’s, the sector saw a 14-year high of £285bn. The UK lending sector seems to be on a solid ground for innovation and changes in consumer habits.
But what is exactly becoming a trend?
Green loans are set to become more common, and even in late 2021 we already saw the likes of NatWest offering £100bn in “eco-friendly loans” until 2025 to small firms looking to capitalise on efforts to tackle climate change and offering incentives for sustainable borrowing. Currently, 1 in 10 of SMEs see this a potential source for future business expansion.
Due to the recent rise in inflation and the higher base interest rates announced by the Bank of England, there has been an increase in re-mortgaging to reduce long term costs, and second charge mortgages to access increased equity.
What could both of these things mean in the long term? The immediate changes resulting from changes to interest rates are likely to have now settled down, so we don’t expect many more major changes there. With Green mortgages, we know that taking more responsibility for the environment is something that businesses avoid at their own peril, so we expect this to increase, but at a slow and steady rate. What do you think?
If you would like to discuss your financial options or possibly work out a re-mortgage on your commercial loans, contact ASC today to assist further; we don’t work for the banks; we work for our clients.