London-based specialist finance broker Churchbridge Capital has removed borrower broker fees on its core bridging loans. At the same time, the company is introducing a cashback system in which part of the commission paid by lenders is passed directly back to clients.
With this step, the firm aims to noticeably reduce financing costs for property investors, landlords, developers and commercial owners. In light of altered conditions in the financial markets, transparent and cost-effective terms are becoming increasingly important for short-term property financing.
Realignment of the cost structure in bridging finance
The newly introduced model departs from standard practice in bridging finance. Brokers typically charge both arrangement fees to borrowers and commission from funding institutions for structuring short-term loans. Churchbridge Capital is now completely waiving direct fee charges for borrowers.
The pro-rata refund of institutional lender commissions creates an immediate liquidity benefit for clients. This financial headroom is intended particularly to benefit market participants who use bridging loans for swift property acquisitions, restructurings or to meet temporary capital requirements.
- —Complete removal of borrower broker fees for bridging loans
- —Introduction of a pro-rata rebate of lender commissions to clients
- —Cost reduction for investors, landlords and developers taking on short-term capital
Significance for the commercial finance market
Short-term bridging loans represent an important instrument for completing transactions ahead of long-term refinancing or securing auction purchases on time. By dispensing with borrower-side fees, the London company reduces the overall financial outlay on such transactions.
With this move, the firm is responding to intense competition among specialist finance intermediaries. Market observers see the combination of fee waivers and a cashback model as an approach that makes institutional pricing structures more accessible to private investors and commercial developers.
