Loans were up 21.2% in the year to September, compared with the same period in 2017, while loan books jumped in value by 16.6%. This is all the more impressive given the current climate of economic volatility – and with Brexit looming ever closer. The continuing stability and strength of bridging finance should be celebrated. The rapid growth of the sector is attracting a number of new brokers looking to offer short-term finance to their clients – so what should they look out for when choosing a lender to work with?
Brokers new to the sector should look to work with established providers who have offered innovative bridging solutions for some time. Traditionally, many thought short-term finance was restricted to home ownership, when in fact it addresses a wide range of borrowing needs. Partnering with lenders who have a good reputation makes it easier for brokers to settle into the market and affords them a safety net of advice and knowledge that may prove useful when dealing with complex cases.
- Bridging industry warns: no exit, no loan
- Bridging finance is more than a short-term fix
- What does technology have in store for the bridging sector?
Underwriting is the bedrock of the lending business, and in the higher-risk environment of bridging finance it is essential to work with lenders who provide excellent services. The nature of the business means speed of delivery is a key quality to look out for – but brokers should beware of underwriters who compromise on due diligence. Striking the right balance between speed and thoroughness is an exercise in delicacy, and the more brokers can trust their lenders, the better they will be able to service their clients.
With a plethora of new lenders stepping into the bridging market in 2018, customers have benefited greatly from the increased competition. However, with more choice, this healthy marketplace makes deciding which lender to work with more difficult. As a rule of thumb, brokers should opt for lenders who are able to innovate and improve their processes to stay ahead of the curve. This isn’t restricted to cutting-edge technology, improved efficiency and new products – customer service and the human dimension are just as important to competitiveness, and intermediaries should bear that in mind when making their choices.
Finally, brokers looking to carve their niche in the bridging sector need to develop lasting, fruitful relationships with lenders. Short-term funding may be quick business, but over the long run it pays to have close ties to providers. Strong partnerships between intermediaries and providers benefit everyone, including clients.