The decision for MT Finance to enter the regulated bridging arena has been some time in the making. Over the past couple of years, it has become all too apparent that many mainstream lenders offering bridging finance have fallen foul of simply chasing rates downwards, rather than focusing on what they should be doing; getting transactions done within tight timescales. It’s been a race to the bottom on rate, at the expense of service.
The truth is that nobody wakes up in the morning wanting bridging finance – they have a specific transactional need. Bridging finance is about providing liquidity and getting transactions done within a tight timescale. Rate is a consideration, of course, but with every client taking out bridging finance wanting to redeem as quickly as possible, rate is less of a consideration than certainty when someone is trying to buy that dream home, their retirement home, or wanting to buy in their perfect location. That is the real driver for the purchase and takes priority to a desire to save 40 basis points on the rate.
This observation is partly why MT Finance has entered the regulated bridging arena. With high levels so liquidity in the market, mainstream lenders have been offering ever cheaper rates in a bid to attract business. That is a positive, and consumers are undoubtedly attracted by and benefiting from better pricing. However, we see that many lenders have lost sight of what they really should be doing, which is delivering the product and transaction to the client.
A number of brokers have communicated to us that some challenger banks are not getting back to clients within appropriate timescales – they are taking 24 hours to even say yes to a transaction on the basis of the information in front of them. Underwriting can then take up to four days, which is more in keeping with a standard residential mortgage than bridging finance. Worryingly, we are also hearing from brokers that the impression they are given is that this is the service that’s available – they either like it or lump it.
At MT Finance, we do things differently. We have gone into the regulated arena to offer competitive products with exceptional service and speed of delivery at heart. We are service-orientated. We recognise we will not be the right choice for every transaction – if a client has plenty of time and is chasing rate, then we might not be the right lender, but we do offer certainty, with great products where needed.
The regulated market has sadly lacked first-class service. This is exactly what MT Finance provide. We have stripped back the process to what we feel are the essentials. We make an initial assessment and come back within one working hour with approval or indicative terms. Within two working hours of receiving an application and supporting documentation, we aim to produce a loan contract and mortgage illustration.
We don’t ask for unnecessary documentation to cover our backs either. All transaction need to be supported and appropriate but we don’t ask for information that isn’t needed in order to check the suitability of the loan. If the client’s exit strategy is the sale of the property within 12 months after which time the loan will be repaid, we don’t need to see evidence of the client’s income or wage slips. If there may be a potential shortfall from the sale, then there might be the need to dig a little further and ask the client how they would cover it. That would be the only reason to ask for that information.
Our target timescales may be tight by other lenders’ standards yet we continually strive to better them. We look to have the valuer and solicitor engaged as soon as possible. We actively drive the case forward, going above and beyond to make sure we fulfil the transaction in an efficient and easy manner. All our underwriters are readily available if the broker needs to speak to them about the case.
The facts speak for themselves – we funded one regulated loan in four days from application, while another went from application to completion in eight days. Superior service can be delivered without cutting corners – and that’s what MT Finance looks forward to delivering in the regulated space.
