broker’s
bridging in association with
The guide to better
For introducer and professional property trader use only. Holding rates and serviceenhancing#LovetoLend Contact a member of our team to find out more about #RomaFLOW and how we can help you with your enquiries 0161 817 insights@romafinance.co.uk7480
Welcome to the Bridging & Commercial Magazine supplement, in association with Roma 6 How to submit the perfect bridging case Avoid the common pitfalls and get your customer’s case smoothly to offer 8 How to choose a bridging lender What brokers should look for when comparing lenders 12 Meet the team Roma has BDMs up and down the country. Find your local contact and get in touch 14 Looking forward Steve Smith, sales director at Roma, gives his predictions for the bridging market Contents 3 The broker’s guide to better bridging
This is a growing, ambitious, and exciting sector, with enormous benefits for your residential, landlord and developer customers, as well as huge business potential for you
Do get in touch with any questions or feedback.
We also analyse the best ways to prepare your customers’ cases, so it goes smoothly through processing and straight to offer.
In this guide, we run through what to look for in a good bridging lender to help you weigh up your options.
WELCOME TO ‘THEGUIDEBROKER’STOBETTERBRIDGING’ FROM ROMAThe4 broker’s
Charlotte Rutter, head of networks and comms, and I, share our predictions for the bridging market over the next year, looking at which sectors are likely to perform best, and what lies ahead as we navigate the cost of living crisis.
There are plenty of providers, but with increased choice comes complexity. In such a crowded marketplace it can be difficult to know which lender to choose for your customer.
Steve Smith, sales director at Roma guide to
better bridging
We hope you enjoy this guide and find it useful.
HOW TO SUBMIT THE BRIDGINGPERFECTCASE Get your applicationcustomer’sthrough first time with these top submission tips, says Roma’s Lorraine Hart, head of credit, and Lisa Toner, completions and processing manager Rates are important, but securing funding makes all the difference in the fast-moving property finance market. Having the finance in place can make or break a deal. That’s why brokers are so important, because you find the right borrowing solutions that your customers may not be able to directly access. Now, by spending a little extra time upfront to perfectly package their case, you can boost the chances of their application going straight to offer. The broker’s guide to better bridging
» nail down the schedule of works Lenders need to understand the timeline of your customer’s project, and this has to be more than just a best guess. We want to see that the project is likely to be completed with time to sell, if that’s part of the exit strategy, or refinance, in order to redeem the loan. In the current market, it’s essential you account for potential delays.
» get the costings right Inadequate appraisals are likely to cause delays, especially in the current environment with rocketing prices. The lender needs to see realistic and comprehensive figures for the project. At Roma, we are also looking for at least a 10% contingency built in to cover unexpected issues and further price hikes.
Here’s how: » give us the big picture—and the detail One of the biggest problems we come across is a lack of clarity on the project. Lenders want a clear transfer of knowledge about the project from the broker to us. Make sure we understand all aspects of the deal. There’s a reason you are using a specialist lender; be upfront about what it is.
1. mistakes on the application forms— double check names, addresses and all figures
We wanted to give you, the borrower and other stakeholders in the project certainty over the mortgage decision early in the process. It gives you peace of mind and enables the investor to start planning their project with confidence. Get in touch Call Roma on 0161 817 7480 and we’ll be happy to talk you through our processes and what information we need to make a lending decision.
» be candid about any problems We know brokers might be worried about mentioning something that they think could Avoid these five potential pitfalls:
» gather the documentation early We don’t ask for a lot of documents, but the quicker you can send them to us the better. Ask your customer for them at, or even before, the first meeting, to give them time to gather what’s needed. Get it right first time
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The broker’s guide to better bridging
3. neglecting to inform us of an issue or problem—tell us upfront and we’ll try to deal with it
The biggest cause of delay we encounter is due to incorrectly packaged cases. But don’t worry, it’s not complicated. At Roma, we’ll hold your hand through the whole process with a dedicated point of contact. We’ve also made our processing quicker than ever before, with our RomaFLOW process for standard bridging cases. It isn’t just about being faster, but about offering certainty of funding, too.
4. costings not being realistic—these need to be detailed and have a contingency on top 5. no schedule of works—we need accurate timelines to see the project can be completed and loan redeemed on time hinder the deal, but it’s essential you don’t leave anything out. We can usually find a way to work with most issues, as long as we know about them. For example, if the deposit is gifted, we need to know that on submission to comply with anti-money laundering rules. It will cause delays if we find out later in the process.
2. failure to provide all the documentation—if we ask for it, we can’t progress without it
Cases are fully mandated and ready to fund on instruction of the solicitor. This is guaranteed, providing no major problems are revealed during the legal process.
The8 broker’s
Choosing a finance provider can be fraught with difficulties if you don’t have first-hand experience, so it can be hard to know where to turn. The good news is there are plenty of good options, as the bridging market is more competitive and broker-friendly than ever before. Here, we run through some of the key factors that can help you decide which bridging lender to trust with your customer’s case. guide
to better bridging
With a wealth of lenders to select from, where do you start? Michael Allison, operations director at Roma, gives his top tips What do you want from a bridging lender? Competitive products are a given, but what else matters to you?
HOW TO CHOOSE A BRIDGING LENDER
When you submit a case, will you have a dedicated point of contact with a direct number? The last thing you want to do is have to explain the whole project to a different person every time you call for an update. We suggest you pay attention to how quickly the phones are picked up on your initial enquiries. Do they seem willing to help or talk you through their processes? Make sure you feel like an individual and not a case number. Word of mouth matters Real-life recommendations are ideal when it comes to choosing a bridging lender. Speak to other brokers, locally, online, or at events to see which lenders they recommend (and which they don’t). Are they members of a trade body? Is the lender a member of a trade association? This can give you a good steer on its commitment to raising industry standards. Is it a member of the ASTL or a lender partner of the NACFB or FIBA—or all three?
The broker’s guide to better bridging
The bridging sector still hasn’t quite shaken off its reputation among some brokers for high fees and opaque charges, despite many lenders and trade organisations working hard to boost standards. Look for lenders that are upfront about all fees, including those charged if your customer cannot redeem in full and on time. How good is their technology?
How can you get in touch with them?
If your customer’s case is complicated, you want a lender that has experience in structuring loans to meet the needs of the project, not just offering an off-the-peg solution. At Roma, we’re proud to lend less ordinary, and many of our loans are bespoke arrangements that we structure after getting under the skin of the project. We don’t take a one-size-fits-all approach to lending, and we never will.
What about those complex deals?
Look for expertise
The best bridging lenders look for a clear, realistic, and fully costed exit strategy before approving a loan. At Roma, we won’t lend on a project that doesn’t have a robust exit plan because we know it boosts the chances of your customer’s project being successful. It’s a big red flag if your finance provider isn’t asking questions about your customer’s exit strategy. Do they have clear and fair fees?
An established lender isn’t necessarily better than a new brand. But most brokers want reassurance that there’s a level of expertise within the business to overcome hurdles and deal with inevitable problems. Look for lenders that have a firm foundation of experience, have continued to thrive through different economic cycles, and have colleagues with the specialist knowledge and skills to support your customers.
How fast is their processing? Speed is one of the most important features of a good lender. Look for those that can tell you their current turnaround times and have processes in place to give you certainty of offer as quickly as possible. We launched RomaFLOW last year, a fast new channel for straightforward cases. It has fewer stages, reduced documentation, and enhanced technology to help move cases smoothly to offer and completion.
A focus on exit strategy
Bridging finance is specialist by nature, and that’s given rise to the myth that it can’t be automated. Some aspects can’t, but many parts of the process can be improved by effective technology. It frees up our time to work on complex cases and your time to deal with more customers. At Roma, we’re committed to improving our tech to make our processes smoother for brokers. Here to help Get in touch with Roma on 0161 817 7480 or visit our website at www.romafinance. co.uk to see how we can help you and your customers. 9
The broker’s guide to better bridging Be who you are, take part in our plan, we’re all Roma family, so no seating plan
The broker’s guide to better bridging From the man who took equity out of his own family home to fund the first loan, to now, the ever growing collective of ‘can-do’ people, we #lovetolend Meet the Roma Team
England#LovetoLend|Scotland| Wales
13 The broker’s guide to better bridging romafinance.co.uk Senior Key Account Manager 07913 236 879 | daniel.hill@romafinance.co.uk Daniel Hill South West & Wales 07599 110 169 | adam.gibb@romafinance.co.uk Adam Gibb South East 07706 736 071 | kirsty.botten@romafinance.co.uk Kirsty Botten North West & Wales 07458 044 022 | george.tuffin@romafinance.co.uk George Tuffin Saffron Abbot Northern England & Scotland 07783 519 910 | saffron.abbot@romafinance.co.uk 07706Midlands735 582 | mark.foley@romafinance.co.uk Mark Foley Sales 07458Director089359 | steve.smith@romafinance.co.uk Steve Smith Find your local Business Development Manager
The14 broker’s guide to better bridging
Roma’s sales director Steve Smith, and head of comms and networks Charlotte Rutter, discuss what lies ahead for the bridging market in the next 12 months Those of us who operate in the bridging sector know how exciting the current market is, with high demand, growing volumes, and new entrants cementing short-term finance as a key part of the property funding mix. No longer a niche product, now most mortgage brokers and financial advisers understand the benefits of bridging, and many are actively operating in the sector. But, alongside all of this positivity lies clear challenges. On the ground, we’re seeing spiralling construction costs and delays as a result of Brexit, the pandemic, and the war in Ukraine. This is an ongoing problem and there is nervousness about how long it will Butcontinue.it’scertainly not stopping bridging finance from happening, with demand incredibly high—particularly on development projects.
Looking forward 15 The broker’s guide to better bridging
Development demand
What lies ahead? Demand and volumes: Demand will stay high and volumes will increase. The market has been growing over the past decade, and this is unlikely to stop. We’ll see shifts, such as more commercialto-residential and semi-commercial conversions, with lots more brownfield sites being rescued and redeveloped.
Interest rates: We’ve held our bridging rates up until now at Roma, but it looks inevitable they will rise in line with wider interest rates. We have to remember that rates are still at around 0.7%— historically very low and certainly less than three years ago. Borrowing is still affordable.
Lending market: This is a developing market and I think we’ll see more consolidation over the next year, especially if funding lines dry up for some of the smaller and newer lenders. But, we can see new entrants coming into this sector, too, as it’s still hugely attractive. Products and service: We’re ripe for further innovation, and we think there will be some key product changes over the next 12 months. There’ll also be a focus on sustainability as offerings begin to take into account energy efficiency and price accordingly. The economy is facing challenges—there’s no getting away from that. But, the fundamental supply and demand imbalance for housing in the UK underpins the bridging finance market, so growth will continue. Property remains a fantastic way for investors to put money into something and create wealth as well as homes. Find out more See how we can help you and your customers find the right bridging solution at www.romafinance.co.uk
We are seeing strength in the heavy refurbishment and ground-up sub-sectors of development finance. It’s more challenging on the commercial side, but that remains very sector specific. Warehousing is strong, but office blocks and retail are certainly We’restruggling.seeing some delays on projects in line with the wider market, but the majority—at least three-quarters—are still running on time. There’s no cause for panic.
Your RomaFLOW Checklist Standard Residential Bridging, Auction Finance and now Light Refurbishment applications go through RomaFLOW. When you choose our fast processing channel you have a short checklist to complete to submit your case. Signed Agreement in Principle Signed Application Form Valuation Fee Schedule of Works (for Light Refurbishment) Technology and intelligent touch underwriting then take over to complete cases within 15 - 28 Days. NEW! We are now accepting Electronic Signatures for an even speedier service! #lovetolend