Bridging & Commercial Supplement — Here for you by Mint Property Finance

Here for you

Welcome to the Bridging & Commercial Magazine

in association with Mint Property Finance

Welcome note

This year saw the eleventh anniversary of Mint Property Finance. As with every milestone, it caused us to pause and reflect on how far we’ve come in this time, and on the future

Since the inception of the business in 2011, we’re proud to have recorded sustained and significant year-on-year growth without any capital losses.

When looking at our team, now 50-plus strong and boasting some of whom I consider to be the best people in the industry, it’s hard to believe that little over a decade ago it was just Mike Silverman and I working out of my family’s garage.

And it’s not just the size of the Mint Property Finance family that has grown, but our range of specialist products and services, with the business evolving from what I will refer to as a ‘vanilla bridging’ company to a full-service specialist finance lender, offering a suite of bridging and development finance products.

The decision to rebrand our business to Mint Property Finance in 2020 acknowledged not only the transformation of the business to date, but paved the way for what is to come, as we continue to shape the future of lending. This includes the addition of our recent multi-

Andrew Lazare

million-pound block-funding facility with Aldermore Bank with an aspiration to deliver longer-term loans of three to five years, and therfore provide regulated products in the future.

Over the coming pages, we look forward to sharing with you a small insight into just some of the ways in which we continue to evolve to not only meet the market’s needs, but to exceed them.

Included is an introduction to our head of risk management, Peter Howarth, who reveals how the department structures every loan to succeed, contributing to the business’s 100% success rate; a look at how we’re always there for the borrower; and our new streamlined legal process, which enables us to complete loans quicker, positioning Mint Property Finance alongside the fastest in the industry.

We’re also pleased to share with you a summary of our recent roundtable hosted in partnership with Bridging & Commercial in which we debated: What does the specialist finance industry need in 2023 and beyond?

People often ask me what I believe is the key to our success and it is simple: our people, our readiness to listen and invest, and to respond. We don’t dictate to investors, brokers, professional introducers and borrowers, we shape our business to their needs.

Here for you

Paul Wertheim

The lending sector is a very different place now than it was at the start of 2022. This year has thrown some huge challenges at us that have affected every business in our industry: a European war, cost of living crisis, a new prime minister and cabinet, and the sad passing of Queen Elizabeth II, to name just a few However, despite this upheaval, we’ve been able to remain steadfast in our business function, consistently shaping our products and services to the needs and requirements of our core partners: borrowers, brokers, professional introducers and investors. In short, Mint remains here for you, our clients.

In fact, while other lenders have struggled for business over the past 18 months, our loan book value has more than doubled. We’ve hit record levels of enquiries, applications, completions and redemptions within the past 12 months. All while maintaining our 100% lending success rate since the company’s inception over 11 years ago.

One of the core facets that’s enabled us to grow exponentially through such a turbulent period is the continuous innovation and improvements we’ve made to our product suite—the Mint Power Products. With ongoing benchmarking against industry trends and competitor rates, we always ensure our borrowers are the ones getting the best deal. For example, the recent launch of our commercial bridge product, with up to 70% LTV, and desktop valuation available up to 50% LTV, was devised following an internal client feedback and consultation process. Obviously, with this increase in business and loans being underwritten, we’ve also grown our team in line with loan book growth during a period when other lenders are reducing their size. Mint now employs over 50 permanent staff members, including a dedicated team of underwriters, as well as a specialist portfolio management team who assist our borrowers through the different stages of their loans and retention releases. This ensures the best use of funding at the best times, setting each loan up for success.

A robust set of monitoring tools and systems enables us to accurately track market activity and keep our clients up to speed with any market changes or trends. Monitored on an ongoing basis, this ensures that we can be proactive as a business to changing market conditions. We are then able to pass this information to our clients, so that they can anticipate and prepare for things like increasing building costs, stamp duty changes, or increases in VAT and interest rates, all of which have impacted borrowers in the past year.

One of the most exciting developments for Mint as a business this year however, has been securing our new multi-million-pound block-bridging facility with Aldermore Bank, enabling us to complete even more deals each and every month. With an institutional lending partner onboard, this also enables the business to look towards the future and focus on providing more long-term loans such as three- to five-year term products and BTL mortgages.

We’ve also continued to strengthen our panel of legal partners over the past year, and have recently streamlined our legals process. This ensures our end users have a quick and easy legals process, putting us in the position of turning enquiries into completions quicker. In an ever-changing market, the Mint team has continually kept itself at the top of its game, ensuring we can continue to be here for you— our existing and future clients.

Setting borrowers up for sucess

Peter Howarth

From tornadoes to archaeological finds and contractors walking off site, Peter Howarth, credit risk manager at Mint Property Finance, shares how the specialist lender’s portfolio management team works tirelessly to keep every loan on track, even when the unexpected events hit

Tell us a little about your role and what it entails

As credit risk manager, I’m responsible for our portfolio management team, a six-strong specialist department committed to overseeing the progress of every loan underwritten within the business.

We’ve two divisions: our development portfolio management team and our bridging portfolio management team. Both have the same objective—to set up loans to succeed and help our clients achieve their goals.

We’ve saved borrowers millions of pounds over the past five years

What is the team’s personal background and how does this benefit the business?

The team all have extensive experience of working in mainstream banking. Prior to joining Mint Property Finance in 2017, I was employed by NatWest Bank where I worked as part of the real estate finance team for 15 years. All my colleagues have similar banking experience and have worked for the likes of HSBC, Lloyds and Yorkshire, among others. This experience, where processes and procedures are rigidly monitored, is invaluable, and form the basis of the operating principles that we apply to our loans to ensure success.

What does the portfolio management team do?

Put simply, the team works as an extension of the broker and/or borrower’s team to manage every single stage of the loan from pre-completion through to completion and redemption.

A sizeable amount of time is invested at the start, with the team working with the borrower and/or broker to ensure that the project timings are realistic and achievable, and that the cash flow is fit for purpose. It’s a stage often underestimated by clients and yet it is without doubt the most crucial to consider to provide the loan every chance of success.

Following completion of the loan, the team then works with the client through every stage of the process, monitoring it on a monthly basis to ensure that the project, and thus the loan, remain on track. If it’s not, we work together with the client to get it back on the right path, leveraging our extensive panel of experts and, if necessary, restructuring the loan to give the borrower the very best opportunity of achieving their goal.

Does it benefit borrowers of all experience?

Yes, absolutely. Loans can falter for many reasons, and development inexperience is only one of them. Recent years have presented a number of challenges that even the most experienced borrower may not have anticipated or experienced. Our portfolio management team is an invaluable support in these situations, bringing over 150 combined years of property development and financing expertise to the table. We’ve saved borrowers millions of pounds over the past five years.

What are some of the most unusual challenges you’ve had to manage?

You’d think we’d have seen it all over the years, but there’s always a new first. Last year’s tornado that swept through Cheshire and destroyed sites in their path, to archaeological finds, are some of the more memorable and unforeseen challenges we’ve had to deal with recently. The economic climate has of course also presented a number of potential issues, from labour shortages to delays in the delivery of goods and soaring energy bills, which have seen the costs of many goods escalate and impacted greatly on borrower’s cash flows and project timings.

In situations like this, how do you ensure the success of a loan?

Our collaborative approach to working means that if there are potential issues with a loan due to increased or unforeseen costs and delays in work, they’re identified early during the build programme/loan term, as opposed to near the end when some issues are harder to solve. This presents the opportunity for us to address the issues before they escalate and it’s too late to rectify them.

The benefits are significant, minimising the cost to borrowers caused by extensions, defaults or renewals.

What benefits does the portfolio management team present for brokers? We like to think we take the pressure off brokers. Our diligent approach means that loans are set up to succeed from the off, thereby reducing the potential for challenges. In the event of unforeseen obstacles such as those mentioned earlier, we’re quick to respond to them. This significantly reduces the number of challenges a broker has to contend with, freeing them up to focus on other opportunities.

Mint property finance is proud to have a 100% business success rate, how does the portfolio management team contribute to this?

Since inception in 2011, Mint Property Finance has been proud to underwrite over £1bn worth of loans, with £425m loans redeemed, all while protecting investor capital without any losses. The portfolio management team has contributed significantly to the business’s 100% success rate.

Pete can be contacted on: Peter.Howarth@mintpf.co.uk

Case studies

Mint has helped turned thousands of property aspirations into reality over the past 11 years. Here is just a sample of the feedback we’ve received:

I have to highlight the ethical and customer-centric approach that Mint Property Finance operates. This, for me, is the approach lenders should adopt to retain the relationship of both the client and the broker Broker

I enjoy dealing with Mint loans as they’re so nice to work with and they share our customerfirst values. Their forms are all standard which makes the process much easier and quicker than other lenders

Solicitor

The speed at which Mint Property Finance released funds following the site inspection was impressive, helping to manage cash-flow and enabling work on site to keep moving

Borrower

I just want to say thank you for being so accommodating. One of the reasons I have always liked working with Mint is that you do look after clients when ‘sh*t hits the fan’ and counts the most

Broker

Saving borrowers time & moneywith our streamlined legal process

We understand that the legal process can be the most challenging for brokersand borrowers alike.

That’s why, following a review of the market, we have streamlined our legalprocedures, enabling Mint Property Finance to complete a loan quicker,positioning the business among the fastest specialist finance lenders inthe industry.

Under our new guidelines, Mint Property Finance’s hand-picked, expertpanel of solicitors now has the option to rely on Title Insurance to a greaterextent to progress an application, this significantly reduces the time and costto borrowers.

This new process is applicable to freehold or leasehold kerbside properties,including auction purchases that aren’t subject to significant works, andtherefore fitting within the business’s standard bridge and light works products.Loans will be subject to a maximum of £500,000 and properties located inEngland and Wales.

The development is the latest in a series of measures we at Mint Property Finance are proud to introduce to meet the evolving needs of the market.

Commenting on the move, Andrew Lazare, founder and managing director at Mint Property Finance, said: “With 11 years of successful lending under our belt, we’re now at the successful stage whereby we are comfortable to embrace the more fully encompassing role of Title Insurance.

WE'RE HERE TO HELP BORROWERS, BROKERS AND OTHER PROFESSIONAL INTRODUCERS ALIKE, AND THIS IS JUST ONE MORE STEP ALONG THE WAY Andrew Lazare

What does the specialist finance industry need in 2023 and beyond?

Bridging & Commercial’s most recent virtual roundtable, in partnership with specialist lender Mint Property Finance, focused on how the bridging industry is expected to change in the foreseeable future, with the panellists passing remark on distribution channels, team structure, and key societal trends

Particular attention was paid to the tools and systems that are currently being embraced and whether these will become even more critical in the years ahead, evolving to adapt to an everchanging industry.

Joining Beth Fisher, publishing director at Medianett Publishing, and Mint Property Finance’s underwriting team leaders Sam Herd (development) and Adam Robson (bridging) on 27th September, were Sara Griffiths, partner at Ratio Law; Michael Cartwright, short-term finance specialist at Buildloan; and Richard Stock, senior associate at Sirius Property Finance.

The panellists were first asked how they felt the industry would change within the next five years. Adam pointed to the morning news, surrounding the Bank of England’s base rate rise and lenders pulling products, as indicators of the environment shifting on a daily basis.

“It’s down to the lenders to adapt to all these changes,” he remarks, “this isn’t something new that we’ve had to do.” He draws references to the pandemic, during which finance providers had to adapt their ways of lending and how they communicated with one another, and highlighted the potential recession to come. “It’s something the industry has been through and survived [previously] . . . It’s time for more robust lenders like ourselves to come to the fore and prove our worth to borrowers and brokers.”

Will this have an impact on smaller and newer lenders? It’s possible. Richard notes that while there are always opportunities in difficult markets for new providers, it’s far likelier for brokers to conduct business with familiar faces.

“The most succinct answer is to give you the 80/20 rule,” Richard explains. “When times become a little bit tougher, this becomes more pertinent; we will, as will lenders, get [at least] 80% of our business from 20%—if not a smaller amount—of brokers we work with. The need for specialist advice is going to be more apparent as well.”

Michael couldn’t have agreed more on this need for expert advice, particularly as he anticipates rapid adjustments in the products being offered.

“The market has been fairly stable in recent years when it comes to LTVs and interest rates. I think we’re going to see a weekly/daily change in what people are offering and the products that are there. That guidance is going to be

imperative, particularly to the large brokerages out there who don’t delve into this world at all, [or] maybe once or twice a year.”

As Beth comments, it’s difficult for finance providers to innovate when there are so many product revisions, and it’ll be interesting to see what comes to fruition, particularly if lenders are able to continue developing their offerings.

Incidentally, it’s the frequency of these changes that Sam sees as one of the biggest threats to the industry.

“You may well have had a bridging loan [and] an exit, [but] that exit may not be secure anymore,” she divulges. Additionally, the cost of funds, with lenders changing their rates, is now a regular hurdle. “You might have an offer and be ready to complete, [but] criteria and rates are going to be changing and that’s a threat to borrowers.”

Offering a legal perspective on the sector, Sara believes the market has been slowed down by various factors. “In general, having the uncertainty [of] the client not being able to sell as quickly as they would have hoped affects the exit strategy,” she discloses, “and whether they’re then able to remortgage with the lenders they were planning on doing so, because interest

rates are changing and the market’s closing itself down slightly to protect what it can.”

As a result, Sara says delays in conveyancing can be caused by solicitors who don’t possess the necessarily skills or legal expertise to deal with the specialist financial property side of things and the requirements that are needed legally.

With the conversation turning to the industry’s favoured tools and systems, and whether or not they will prove to be even more critical moving forward, Sam identifies local knowledge as vital to each deal, utilising the tools that are currently in place to look back at the successes and failures of previous loans in certain locations.

“We won’t be able to just rely on [someone] telling you it’s worth X amount,” she adds. “There will be projects that get delayed over the next 12-18 months, from a development point of view, and having that local knowledge and knowing why [certain projects were] delayed, is going to be key moving forward in an everchanging market.”

“We can definitely look at tools from our side of things to be able to streamline the process to make things quicker for borrowers and lender

clients alike,” Sara confesses. She continues by saying there are things on the market that perhaps aren’t being utilised as much as they could be, such as electronic signatures, and ponders how these tools can be used to help speed up the process, all the while meeting obligations.

“The process that we have for many lenders is very labour intensive,” Michael notes, whereby it can involve chatting to numerous channels. With a nod to Sara’s comments on some tools not being used, he spoke about online portals either being non-existent or limited. So what is needed? “Transparent systems, where everyone involved can get an update on the case to find out where the next step lies—whether it’s with the client, broker, lender or lawyer; these things are going to be imperative moving forward.”

In reference to Michael’s point about the process being labour heavy, Richard remarks there is a labour shortage within the industry. “People have moved on or been released because of the pandemic. A lot of these roles haven’t been replaced. We’ve got to get appropriately trained staff in place now.”

With the consensus being more IT and knowledgeable individuals are required, Adam explains what Mint is doing to attract and retain talented people. “With everything that happened with the pandemic, working from home is key to a lot of people,” he says. In addition to investing in talent, it’s the little things like rewarding good performance and celebrating internally, such as birthdays, that ultimately help to retain staff. Don’t forget to watch the video to hear more about what the specialist finance industry needs in 2023 and beyond, and why two-thirds of our virtual roundtable attendees only expect a slight change in distribution channels over the next 1-5 years, as opposed to major steps forward.

Underwriting team leader of bridging at Mint Property Finance

Sara Griffiths Partner at Ratio Law LLP

Richard Stock Senior associate at Sirius Property Finance

Short-term finance specialist at Buildloan

Adam Robson

Samantha Herd Underwriting team leader of development at Mint Property Finance

Michael Cartwright

The future of lendingAndrew Lazare

It’s fair to say that in 2019 none of us anticipated what lay ahead. The pandemic changed the global business landscape in a way that we’ve never experienced before. The war in Ukraine, and subsequent worldwide economic fallout, coupled with political instability, has led to one of the most turbulent times in the history of recent business

While the economic market is uncertain, we remain confident and committed to shaping the future of lending. Throughout all the challenges of the past two years, Mint Property Finance has been proud to keep lending. And we will continue to do so.

Our expert portfolio management team, introduced earlier in this supplement, along with many of our senior business figureheads, have extensive experience of the 2008 recession and are well-placed to guide brokers and borrowers through the challenges ahead. Our collaborative, people-first approach to business, something I largely credit the sustained and significant growth of Mint Property Finance over the past 11 years, will continue to prove invaluable to the market over the coming months. We will continue to shape our products and services to meet our client’s needs, such as the streamlining of our legal processes in order to complete a loan quicker, and not dictate our own.

While rising interest rates and a decline in consumer confidence will inevitably impact on the sector, leading to a decline in new entrants to the market and, sadly, the loss of others, established and well-structured lenders such as Mint Property Finance will overcome the challenges and can be confident of long-term growth.

We are in a dynamic market and businesses will need to remain nimble to survive. Those that do, however, will flourish.