Mathon Finance Bridging Loan
Following the collapse of Mathon Finance some customers will be looking for new suppliers of bridging loans, the company had been operating from its Glasgow based office for 10 years and had been the preferred lender for many investors who needed short term financing.
Anyone looking for a bridging loan can rest assured that other lenders have stepped in to fill the gap that has been left following administration proceedings earlier this year. Mathon Finance was founded in 2000 and its business base continued to grow until the credit crunch hit the financial service industry and placed some loans in the ‘at risk’ category. By concentrating upon commercial and investment premises the company had little protection from the prevailing tide of business failures that accompanied the first wave of panic and disruption during 2007/08.
The company managed to build one of the biggest UK loan books in less than seven years and prided itself upon being able to approve large loans quickly without having to go through the often drawn out procedure of taking every application to committee. Loans that covered 100% of purchase price were common and multi-million pound advances were not unusual, this reflected the company’s positive attitude towards the future, sadly these strategies seem, with hindsight, to have been a serious misjudgement.
Some would say that Mathon Finance should not have opened an office in Southern Ireland – the Dublin boom was spectacular, its fall has been tragic – but at the time there was little indication of the crisis that was to come.
The market for bridging loans has always been dependant upon a client base that needs access to cash quickly for a variety of reasons – currently the largest client group are auction buyers who often need to complete a deal within 14 days. Access to bridging loans in these circumstances is often the only way that buyers can be sure they have the cash to carry through their purchase and ensure that they do not lose the fees and deposits paid on the day of the auction.
Mathon finance was the first port of call for many commercial developers, entrepreneurs and investors who needed to secure an auction purchase, were waiting upon another property sale or needed to make a quick purchase.
Most bridging loan companies will offer similar terms and conditions to those that were offered by Mathon finance and the availability of bridging loans from other lenders has not been affected by the administration announcement in March. Anyone who is considering a high cost loan of this kind should always make sure that they understand the full implications of defaulting on the loan or failing to repay within the specified period – the penalty charges can be very severe. Your broker can explain the restrictions and penalties that may be applied.
A good professional advisor will be able to source a range of new options for anyone who previously relied upon Mathon finance for their bridging loan.