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80% of brokers back regulation of bridging sector

by: Mortgage Solutions
  • 04/05/2012
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80% of brokers back regulation of bridging sector
Only regulation can help bridging lenders to get their own houses in order, say 80% of brokers in the latest Mortgage Solutions poll.

A further 16% believe bridging lenders will successfully self-regulate the market, while 4% of brokers remain undecided.

Last week, Precise Mortgages revealed it had entered into a partnership with seven mortgage distributors, in a bid to “clean up” the bridging market.

Mark Posniak, head of marketing and operations at Dragonfly Property Finance said that the bridging market has cleaned up its act over the past couple of years.

He said: “An element of bridging finance is already regulated but just a fraction of the overall business transacted. A lender who is not regulated doesn’t make them a “bad lender” nor does it mean that they employ bad practices. Many of them actually employ best practice in the sector and the volume of repeat business transacted suggests that brokers who understand the space realise this too.”

Posniak added: “Bridging finance is a specialist area and brokers need to be sure that they understand the deals and the lenders, but that doesn’t necessarily infer just dealing with regulated lenders.”

Andrew Bloom, managing director at Masthaven Bridging Finance said second-charge lending on domestic residents should become FSA-regulated in the next two-years.

“It is our view that in the coming years there will be a continual move towards regulation in all forms of property lending.

“We strongly recommend that bridging brokers use reputable firms that are long standing in the industry. We’ve recently had a supervisory visit by the FSA and the fact the FSA check firms that are regulated should give brokers confidence that these lenders are treating their customer fairly.”

 

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