Comment
Building bridges with the Financial Services Authority
The FSA has shone its spotlight on the bridging sector, now is our chance to fight our corner
by Fahim Antoniades, group director, Mortgage Centre IFA
In my last column I mentioned how it was interesting that that at the Mortgage Business Expo, Sheila Nicoll of the Financial Services Authority felt it necessary to pass comment on two non-regulated sectors (bridging and buy-to-let) in what seemed to be a kind of warning shot to all, in case anyone was tempted in using either types of lending inappropriately. The regulator’s interest in non- regulated matters is interesting in itself and the allusion I made that this might be the sign of things to come has since taken on a new shape. The Association of Bridging Professionals is to hold its first ever forum and invited as a guest speaker is David Forsdyke of the FSA. David will be speaking and taking questions from the audience who will no doubt be testing him on where the FSA’s thinking on the bridging market sits and where is it likely to go. In the past, it’s been fair to say that there has been a marked disconnection between the industry and the regulator in the sense that industry players haven’t always believed that the FSA understood the market in
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the way they should and that the policies and views expressed by the FSA were off the mark. It will be interesting therefore to see how David Forsdyke’s input will translate seeing as he used to be a client-facing advisor before he joined the FSA. There is hope that he will be the bridge which will connect and bring a positive influence on either side.
“One USP which bridging loans had to offer in days gone by was quick money”
Legal moves In other news it’s refreshing to hear that Precise Mortgages is offering joint legal representation for borrowers. I’ve often wondered why bridging lenders have historically been hesitant to do the same. After all, there is no legal reason behind why they shouldn’t and it would appear to me that the reticence to do so is for nothing more than legacy issues. In other words, a general attitude of “well, that’s how it’s normally done so no need to change it”. One key element or unique selling point which bridging loans had to offer in days gone by was quick money. Anyone who
knows the industry will say that this USP has seen a clear erosion over the years, with some bridging loans taking as long to arrange as standard residential mortgages. Delivering quick money was only possible when backed by a quick legal process and it’s the slow protraction of this process over time which sees us where we are today. However, with joint legal representation, the potential for quick (or at least quicker) money is back in the fray and I wish Precise every bit of success in paving the way forward for quicker delivery of service.
Snap out of it Nevertheless, I suspect for the bridging sector to truly re-discover its speed mojo, it will take more than just joint representation. It will take a willingness to snap out of the administrative lethargy so prevalent in many a UK back- office and a change of attitude from apathy to activity. And I say UK back-office since speed of delivery doesn’t seem to be an issue in Australia – a mortgage market which can be compared to ours in terms of development and range of products and services on offer to the consumer. Browsing through the first Australian bridging website, as revealed by a Google search, I am faced with statements such as “funds can be provided within 24-72 hours”. Why can’t we do that? Are we less able than our Aussie cousins or less willing?
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