The new 12-month refurbishment loan at 1.25% per month up to 70% loan to value and comes with a 1% arrangement fee and 1% redemption fee.
Additionally Fincorp is also offering to loan up to 70% of the refurbishment costs at a flat rate of 1.5% per month with no additional fees.
Nigel Alexander, director of Fincorp, said: “This is about putting the power back in the customer’s hands – we want to offer them the choice to spread their costs evenly across the period of the loan without the cost of an up-front arrangement fee.
“But we also want to do business with clients who want the flexibility of a lower monthly rate and the option to pay fees.”
It is the lender’s belief that until now, borrowers wanting to compare the cost of loans with and without fees have had to look at different lenders with different criteria and with which they may have different strengths of relationship.
Alexander said: “We wanted to change that status quo. After listening to our intermediary partners’ feedback, we concluded that our commitment to being clear and simple about our charging didn’t mean we couldn’t offer borrowers flexibility.
“The bridging market has changed a lot in the past seven years and this move demonstrates we aren’t afraid to change with it, where that is in the best interests of our clients.”
He said that the lender’s decision to break with its long-held “no fees” stance was the result of increasing competition in the bridging market where headline rates have been dropping steadily for the past two to three years.
But he added: “Giving customers a choice about how to pay for their loans is the absolute standard in the mainstream residential mortgage market – and in the buy-to-let space. Our decision to offer our clients that same choice in the bridging market is the next step in the evolution of the bridging market – and we believe it’s a responsible step to take.”
The Fincorp Flexible Refurbishment Loan is available immediately and is funded through a £15m tranche of finance.
