65% of brokers confirm that they would take on short term finance clients
65% of brokers cited that the key reason they would take on short term finance clients was the ability to diversify, followed by 60% of brokers who said the main driver was the increased demand for bridging cases, according to a survey of 200 brokers by InterBay Commercial, part of specialist lending group OneSavings Bank.
When looking back over the past year, 70% of brokers believe that the demand for bridging has risen in the last year and only 8% said they thought demand for bridging loans had fallen. When asked about the reasons to take on a bridging application, 65% pointed towards the fact that bridging cases often involve higher fees and therefore presented an opportunity to earn additional income.
Having experienced increased growth over the past year and looking ahead at the next twelve months, twelve times as many brokers expect demand for bridging to grow rather than shrink (62% vs 5%). Of those who thought it would grow, most paired the demand with rising house prices (42%), closely followed by growing demand from buy-to-let investors (40%). With this expected growth within the specialist lending market, there is an increasing need for brokers to be able to specialise and be aware of the lending options available to their clients.
Brokers are not the only ones adapting to the growth in demand for bridging. 67.5% of brokers said that lenders have increased the variety of bridging products that they have on offer.
Darrell Walker, pictured, Head of Sales, InterBay Commercial commented:
“With the continuing political uncertainty around Brexit, activity in the property market is sluggish and impacting on sales. Brokers therefore need to be able to provide their clients, particularly investors, with fast and flexible options to finance their next project so they can make the most of higher yielding alternatives, such as HMOs.
“As the demand increases for specialist finance products, brokers should make sure they are informed. This requires more education around the options lenders offer and the speed at which the solution can be secured. But most important is the relationship that has been built with the BDM who is best placed to inform brokers on product availability and criteria guidelines as well as offering flexible tailored advice.”