WHY BROKERS WILL BE AT THE HEART OF GROWING THE BRIDGING SECTOR
10.07.24
Whatever your party political persuasion – try saying that after a drink or two – I do already sense a greater degree of optimism amongst the property market, and particularly within the bridging lending sector.
By Jaxon Stevens, Sales Director, Tuscan Capital.
Partly this is down to the General Election now being behind us, since big political events inevitably lead to some uncertainty and plans being put on hold.
But there is also a clear belief that business is on the up. This shone through in the inaugural Bridging Market Survey from the Bridging and Development Lenders’ Association (BDLA), where almost two-thirds of bridging figures said they expected annual origination volumes to grow.
With previous data from the trade body showing loan books are at record highs, it’s evident there is much more to come from bridging. What’s equally apparent is brokers will be at the heart of this increased level of activity.
Why broker relationships are crucial
The research from the BDLA highlights just how vital brokers are to lenders in this market. More than half (53%) said that independent brokers were the most significant source of originations for their business, while just under a third (32%) pointed to master brokers.
That’s a really useful insight into the role of brokers. The reality is landlords and property investors rely heavily on their brokers, to the point they are effectively viewed as partners in their projects. They know brokers are perfectly placed to pinpoint the right products and lenders for their plans, the funding options that are going to deliver for them.
There’s more to that than just identifying a cheap rate, as well. Obviously cost will be a factor – no investor wants to spend more than they have to on their external funding – but speed and deliverability will be just as important, if not even more so.
That’s where brokers really come into their own, understanding which lenders can be relied upon to deliver those promised funds and in a timeframe that works for the investor.
Building relationships
As a result, if any lender wants to build a profile in the bridging market, they need to go the extra mile in developing long-lasting relationships with brokers. There are many elements to do so, but fundamentally it comes down to understanding those brokers and their customers.
Local knowledge is absolutely crucial on this front. We know inconsistency around the handling of cases in regional areas can be an enormous frustration for brokers. All too often cases outside of the South East are subject to a less predictable and less reliable standard of service.
It doesn’t have to be like this, though. There is no reason for the experience to be different simply because the investor is looking to purchase a property or refinance a portfolio outside the capital.
We’ve invested heavily in our team to ensure we can provide a personal touch for brokers and borrowers across the country, putting boots on the ground in areas that will truly make a difference.
It means brokers have someone to speak to in person, as and when cases have particular quirks or issues, helping us deliver across the board.
These new recruits all have extensive market experience, so have been able to hit the ground running, further boosting our ability to work closely with brokers.
Improving communication
Those relationships will be boosted by better communication, too. It can be very easy for lenders to fall into the trap of expecting brokers to be experts on our individual processes, or even to fully understand the potential pressure points for applications.
This can be a significant mistake – by being more open and transparent we can ensure cases progress successfully.
At Tuscan, for example, we work closely with brokers so they are fully aware of where cases can suffer delays, perhaps through gaps in the information provided at the outset or failing to be clear about the exit strategy.
This openness builds trust, as it demonstrates to the broker we are on their side and want to help their clients.
Relationships take time
The reality is that relationships between brokers and lenders are not built overnight. It takes time, months and years really, in which the lender has to prove itself over and over again.
Doing so is worth the effort though, as those relationships are the cornerstone for lenders who have been in the market for a long time, as we have.
Longevity doesn’t happen by accident, it’s the result of consistently delivering for brokers and their clients.
We certainly intend to keep pushing in this direction and, as a broker, if you’re not ‘feeling it’ from the lenders you use, then make sure you explore other options. There is a competitive market to choose from, and we’ll always endeavour to do right by you and your bridging clients.
Read the full article on The Intermediary.
For more information or to get in touch with the team, please contact us:
Call Us: 020 7846 9030
Email info@tuscancapital.co.uk
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