Bridging applications hit record levels in the third quarter of this year, according to the latest figures from the Association of Short-Term Lenders.

Applications totalled £7.6bn for the quarter, an increase of 39.1 per cent on the previous quarter and up 25.7 per cent on the same time last year, the data reveals.

The figures compiled by auditors from data probided by members of the ASTL showed the number of bridging completions also rose in the third quarter, up by more than 40 per cent and totalling £680m in value, up 44.8 per cent on Q2, although still down by 27.6 per cent on the same period last year.

Loan books showed a small increase of 0.6 per cent on the previous quarter and 5 per cent on the same period last year – remaining at around £4.5bn. While average LTVs increased slightly since Q2, but continue to remain at sub-60 per cent.

The value of loans in default showed a small increase of 3.3 per cent over Q2 2020 but were 23.1 per cent higher than the same period last year.

ASTL chief executive Vic Jannels says: “The Q3 lending figures from the ASTL reflect feedback from the market demonstrating that this has been a hugely  busy period for bridging lending. Applications over the quarter totalled £7.6bn, which is the highest figure we have ever recorded. Completions also bounced back on the previous quarter but remain down on last year as an overhang of the first national lockdown. We’re unlikely to see this overhang again as the market remained open during the second lockdown – but we must still remain cautious about the future, as the road ahead remains full of economic uncertainty.

“That said, if the recent positive news about vaccines come to fruition and lenders continue to underwrite loans sensibly, whilst taking a proactive and collaborative approach to customers in default, then there is no reason why this quarter’s figures should not prove a strong foundation for a robust and sustainable recovery.”