Allica Bank has launched a new bridge-to-term product aimed at owner occupiers and commercial property investors.
The loan allows borrowers to start with a bridging agreement and automatically move to a lower-cost term loan when certain conditions are met.
This means businesses and investors only apply once, pay a single application and valuation fee, and can access more affordable finance without extra delays or paperwork.
The product is Allica’s first major change to the commercial bridging market since it entered the sector last year.
It is designed for borrowers with projects that currently do not meet term commercial mortgage criteria or those carrying out property refurbishments.
There is also an option to release equity at the trigger stage for further investment.
Brokers get paid commission both at the start and at the trigger point.
There are two new products, the Stabiliser and the Improver, are both available for up to seven years, with an initial bridging period of up to two years.
The Stabiliser is for businesses working towards meeting commercial mortgage criteria, with loans between £250,000 and £5m and rates from Bank of England base rate (BBR) + 6.45% during bridging.
The Improver is for refurbishments, especially where improvements are made to a property’s environmental rating, offering loans from £500,000 to £5m and rates from BBR + 7.05% during bridging.
Both products move to commercial mortgage rates from BBR + 2.90% for owner-occupiers and BBR + 4.45% for investors when conditions are met.
Nick Baker (pictured), chief commercial officer at Allica Bank, said: “we’re proud to launch Allica’s new bridge-to-term proposition – a truly innovative way to give brokers and borrowers the certainty they need in a changing market.
“By combining bridging and term lending into a single, streamlined journey, we’re helping established businesses act quickly and confidently on their property plans – without the usual delays, fees, or duplicate underwriting.
“This launch is the result of significant work from our team, and close collaboration with our broker community.
“It’s a major step forward in our ambition for Allica to become a break-out bridging lender.”
