News Review: Short Term Finance
A regulated future on the horizon for bridging
by Paul Brett, business
development director, borro
Working within a regulated environment is part and parcel of an adviser’s business existence. each year seems to bring
with it greater regulation or the promise of more rules - and at a time when the generation of new business is at its most challenging.
Necessary evil i think it is fair to say, most of us regard regulation as a necessary, if overbearing, part of the professionalisation of the financial services industry. While we moan from time to time about the seemingly endless revision of rulebooks and consultation papers, the consensus seems to be that the end game will be worthwhile for the buying public as well as help raise awareness of the value of the adviser sector. of course, there are still areas of the lending industry,
which are still outside the regulatory envelope, particularly buy-to-let and a fair proportion of the bridging sector.
Opportunities For advisers, unregulated business can sometimes be seen as an opportunity to escape some of the compliance red tape that surrounds day- to-day business dealing in the regulated world. therefore, it was timely that robert Sinclair, director of ami, reminded us of the dangers of not applying the same care to putting clients into an unregulated product as they would into a regulated one. not only does this have relevance to the importance of maintaining a consistent standard of record keeping but also in the wider remit of demonstrating a proper paper trail in relation to product research. as robert points out,
those brokers attracted to unregulated products carrying override in a market where there are similar products from regulated lenders, are likely to attract attention from the regulator
“Those brokers attracted to unregulated products carrying override in a market where there are similar products from regulated lend- ers, are likely to attract attention from the regula- tor and the story had better be convincing”
and the story had better be convincing.
Scrutiny clearly, while the bridging portion of the short-term
lending market is still largely unregulated from a provider’s perspective, the danger to the regulated intermediary is obvious because regardless of whether the product is regulated or not, the adviser always is. no one should then be surprised that unregulated activity in every part of the client facing lending market is going to come under greater scrutiny. the FSa and its successor will not need too many reasons to push for bridging lending to be brought into the fold.
Straddle the fence of course, having buy-to- let straddling the same regulated/unregulated fence, has provided bridging with a good reason to maintain its own regulated /unregulated stance. However, this anomaly might not be enough to hold the line, particularly if the evidence stacks up that unregulated products are being used inappropriately. it would seem that the bridging market has reached a tipping point and it will be interesting to see how the industry responds.
22 mortgage introducer JANUARY 2012
Page 1 |
Page 2 |
Page 3 |
Page 4 |
Page 5 |
Page 6 |
Page 7 |
Page 8 |
Page 9 |
Page 10 |
Page 11 |
Page 12 |
Page 13 |
Page 14 |
Page 15 |
Page 16 |
Page 17 |
Page 18 |
Page 19 |
Page 20 |
Page 21 |
Page 22 |
Page 23 |
Page 24 |
Page 25 |
Page 26 |
Page 27 |
Page 28 |
Page 29 |
Page 30 |
Page 31 |
Page 32 |
Page 33 |
Page 34 |
Page 35 |
Page 36 |
Page 37 |
Page 38 |
Page 39 |
Page 40 |
Page 41 |
Page 42 |
Page 43 |
Page 44 |
Page 45 |
Page 46 |
Page 47 |
Page 48 |
Page 49 |
Page 50 |
Page 51 |
Page 52