February 2018
The joint event for the Association of Short Term Lenders (ASTL) and the Financial Intermediary & Broker Association (FIBA) took place on 22nd February and was hosted by United Trust Bank.
The first in a long list of FIBA partner events this year, the informal discussion explored some of the ways in which the lending process could be simplified and addressed some of the main concerns of intermediaries operating in the bridging space.
Attendees included brokers, lenders and solicitors from across the industry, as well as Benson Hersch, CEO at the ASTL; Adam Tyler, executive chairman of FIBA; and Gavin Diamond, commercial director of bridging at United Trust Bank.
The conversation kicked off by focusing on whether there were fundamental differences between lenders' application requirements. Brokers in the room unanimously agreed that there were slight but significant differences on a case-by-case basis. Tailoring each application was deemed essential, as was providing high-quality, detailed proposals to help speed up the process and ensure complete transparency. Brokers also agreed that they could help themselves by both knowing and meeting each lender’s criteria.
In turn, brokers set out their key pain points and expectations from lenders, with the most important proving to be direct access to decision makers. This was highlighted as the key to a smooth, simple and fast lending process, and it was agreed that too many barriers between brokers and underwriters could mean a loss of business for the lender.
Another issue cited was the need for transparency, including easily accessible broker information, as well as fast, concise and clear communication. Straightforward discussion helps to enable swift decision making without time delays – a crucial factor in the bridging process. Brokers also pointed out that lenders must live up to their promises and avoid false advertising, especially on turnaround times and service standards.
Solicitor involvement in the lending process was also discussed, with many brokers feeling that borrowers’ solicitors often weren’t familiar with the specialist market, and could, therefore, slow the lending process down. Brokers agreed that lenders’ solicitors should support those of the client throughout the process and that full engagement from all sides was key. They also expressed their wish to be able to recommend the right solicitors to their clients, claiming a trade body-certified list would be especially helpful.
The topic of broker and lender fees and when it was most appropriate to charge was also debated. Although upfront charges could help to filter out ‘window shoppers’, both lenders and brokers confirmed a wariness for such charges due to the risk of losing business.
The final point was that of the role of trade associations in the unregulated environment. Two key expectations were the provision of educational resources – including learning material and lists of recommended partners – and self-policing capabilities. Participants agreed there was often a danger of a lack of skills from fresh entrants to the market – therefore associations (as well as lenders) should carefully vet who they accept on to their panels and assist in dispute resolution in case there are issues on the lender, broker or partner side.
In the coming months, FIBA will be organising and taking part in a vast range of industry events across the UK, including a regional events series beginning in April. More information can be found at www.fiba.org.uk/events.