Educating Brokers and Introducers – The right information first time, every time
By Bridging Loan Directory -
Earlier this year, The Financial Services Authority advised bridging lenders to take responsibility for educating introducers about the difference between regulated and unregulated cases. As education and product knowledge is key in any market, it is crucial this message is also taken on board by lenders in non-regulated short-term bridging finance.
John Clifford, MD at Central Bridging Loans, is a keen advocate of the education of introducers stating “We need to ensure that as Principal lenders we are leading the way in providing informative and incisive information to help educate introducers by improving their awareness of the difference aspects of FSA and CCA regulated lending and what applies to what lending scenario. This can only benefit the industry in general as poorly & inaccurately underwritten lending can sometimes result in negative press, which reflects badly on us all.”
Whilst it is acknowledged that many introducers have been around for a long time and are knowledgeable, there is still a lot that can be done. As the bridging finance market continues to grow we are seeing an increasing number of new entrants, particularly in the non-regulated markets where introducers have moved across from other areas of finance. For these relatively new introducers, it can take time to understand the requirements and nuances of different lenders. If information is lacking at the initial enquiry stage, accuracy and the speed of decision making may be flawed, and may ultimately lead to a loan being unenforceable if not set up correctly.
Robust and clearly defined exit strategies are key to the decision making process for bridging finance, which takes on greater importance if refinance is sought as the exit plan. So lenders need to ensure they are communicating their requirements to introducers clearly and on a regular basis.
John Clifford explained further “In some instances we have had to go back and forth to brokers and introducers due to incomplete information being provided at the outset, particularly around redemption strategies. The risk analysis and decision process would be enhanced considerably if brokers obtained a fuller fact find from their clients at the initial enquiry stage. In order to do this, we need to encourage introducers to provide clear, concise, thought through presentation and delivery of documents. This will ensure enquiries are reviewed quicker with full and accurate assessments made.”
With regulation for the bridging industry looking increasingly likely, the coming months will prove pivotal in educating introducers about regulatory requirements. Ensuring brokers are aware of what those requirements are, will be key to improving standards and perception of the industry as a whole.