Magnet Capital becomes ASTL member
Magnet Capital, which last year added to its sales team, is a specialist development finance lender and lends up to 55 per cent gross development value (GDV).
Vic Jannels, CEO of the ASTL, said: “I’m very pleased to welcome Magnet Capital as the latest lender to join the ASTL. Development finance is an important element of short-term property lending as it’s the driving force behind SME developers, who play such a key role in delivering the additional housing we so desperately need as a nation.
“Having a diverse mix of lender members enables us to better represent the needs of all lenders in our sector, whatever their particular area of specialism.”
Sam Howard, co-chief executive officer and co-founder of Magnet Capital, said: “Magnet Capital’s experienced team of development finance experts is laser-focused on delivering on what we promise. Our dedication to working with customers aligns with the ASTL’s commitment to high standards and we are delighted to become members of the association”.
Ashley Ilsen, co-chief executive officer and co-founder of the lender, added: “At Magnet Capital, our focus is on consistently delivering the best outcomes for customers, and this aligns with one of the objectives of the ASTL.
“We pride ourselves on being transparent in all of our practices, and this is why we’ve developed such a strong brand in the development finance sector over recent years.”
Bridging loan books reach record £7.1bn against fall in completion and application values – ASTL
Despite this, data collected by the Association of Short Term Lenders (ASTL) showed that the value of applications and completions declined over the three-month period.
During the quarter, the value of bridging completions fell by 5.3 per cent to £1.3bn when compared to the previous quarter. Meanwhile the value of applications contracted by 5.9 per cent quarter-on-quarter to £9.2bn.
Average loan to values (LTVs) also dropped from 59.3 per cent in Q1 to 57.8 per cent in the three months to June.
Vic Jannels, CEO of the ASTL said: “The short-term lending sector continued to demonstrate its versatility and resilience in the second quarter of this year, during which period members combined loan books have exceeded £7bn for the first time.
“Whilst applications and completions were slightly down on the previous quarter, they were both higher than the same period last year. Given that we are still faced with the vagaries of an uncertain economy, and faltering property market, this represents another very strong performance.”
He added: “We cannot ignore the wider economic environment, which is putting greater pressure on exit strategies and so it’s important that lenders continue to take a robust approach to underwriting to help ensure the market continues to grow in a cautious and sustainable way.
“In doing this, the market will be well placed to help even more customers to finance transitional periods in the future.”
One Mortgage System joins the ASTL
The customisable software was created by brokers and can be used by brokers, packagers, networks and lenders. It provides technology to reduce the need for rekeying client data.
Last year, some 42,000 applications were processed through OMS at a value of £9.3bn. Around 12,000 users have started to use the system in the last four years.
Neal Jannels (pictured), managing director of OMS, said: “2023 has already been a watershed year for OMS as we have steadily increased the number of brokers with whom we work and enhanced our proposition for lenders. We are working with a growing number of lenders, delivering their back-office systems and technology, and believe we can help forward-thinking short-term lenders to streamline their processes and manage their lending more effectively.
“Market leading technology doesn’t just benefit lenders, but it also benefits customers and we share the ASTL’s commitment to delivering consistently excellent customer outcomes.”
Vic Jannels, CEO of the ASTL, said: “I’m really pleased to welcome OMS Group as the latest professional organisation to become an associate member of the ASTL. Our growing membership not only reflects the increasing number of like-minded businesses that want to demonstrate a commitment to high standards, but it also amplifies our voice as an association and enables us to better represent the interests of our sector and our customers.”
MJ Group joins the ASTL
The company launched in 2006 and works with traditional international and national banks, challenger banks, bridging lenders, lending institutions, property funds, developers and financial organisations.
Robert Cohen, managing director at MJ Group, said: “At MJ Group, we are proud of our reputation for high quality, informed and independent advice that has become a benchmark for best practice and industry standards. In the world of short-term mortgage lending, it’s the ASTL that sets the benchmark for lenders when it comes to high standards and customer focus.
“The recent launch of the Certified Practitioner in Specialist Property Finance (CPSP) programme, as a joint initiative between the ASTL, FIBA, and the London Institute of Banking and Finance (LIBF) demonstrates the crucial role the association plays in continuing to drive new standards of professionalism. As an organisation that shares many of the ASTL’s values and ambition, we are delighted to become an associate member.”
Vic Jannels (pictured), CEO of the ASTL, added: “I’m really pleased to welcome MJ Group as the latest professional organisation to become an associate member of the ASTL.
“Short-term lending is a vital cog in the property industry, providing a funding solution for a wide variety of circumstances, and it’s important that we work closely with other associated businesses, such as valuers, to ensure we continue to deliver the best possible experience for customers. This is why associate members are so important to the ASTL, and our growing membership reflects the increasing number of like-minded businesses that want to demonstrate a commitment to high standards.”
Bridging lending continues to grow with completions reaching £1.4bn in Q1 – ASTL
Data from the Association of Short Term Lenders (ASTL) revealed that bridging completions rose by 11.8 per cent compared to the previous quarter to pass £1.4bn.
Completions were up by 36.3 per cent when compared to Q1 2022, and 20.4 per cent higher than the 12 months to March 2022.
Applications also increased, with a total value of £9.8bn in Q1 which was 13.1 per cent higher than Q4 2022. It was a 52.1 per cent rise on the same period in 2022, but a slight drop of 0.9 per cent when compared to the 12 months to March last year.
The value of loan books also increased, with a four per cent jump to £6.8bn, which was a new high for the sector. This was also up by 52.1 per cent when compared to both Q1 last year and the 12 months to March 2022.
Vic Jannels (pictured), CEO of the ASTL, said: “The somewhat indifferent performance of the economy has not affected demand for short-term finance, which continues to demonstrate that it can provide a versatile source of funding during all economic cycles. Loan books have reached another record high of more than £6.8bn and applications have now shown an increase in each of the last five consecutive quarters.
“Given the ongoing challenging economic environment, it’s important that lenders continue to take a robust approach to underwriting to help ensure the market continues to grow in a cautious and sustainable way so that it can help even more customers to finance transitional periods in the future.”
ASTL, FIBA and LIBF-backed specialist property finance qualification now live
The trade bodies have worked together on the qualification, announcing its launch at the ASTL conference in October last year and it opening for registrations in March.
The programme is online and covers bridging, short-term finance, development finance and specialist buy to let.
It offers a “definitive and targeted education programme for the short-term and specialist lending sector” and participants who complete modules are warded an LIBF digital badge and accredited for CPD purposes.
Registration for the course is available here.
Vic Jannels (pictured), CEO at the ASTL, said that the launch of the CPSP was the “culmination of a long and exciting journey and an excellent example of trade associations working together for the benefit of the industry and our customers”.
He added: “The close collaboration between the ASTL, the LIBF and Adam at FIBA has been instrumental in making the first qualification in our sector a reality.
“This is a major steppingstone in continuing to enhance standards, increase professionalism and advance the reputation of the specialist finance sector.”
Two years of work and collaboration
Adam Tyler, consultant to FIBA, added that the endeavour took two years of work and collaboration with many industry colleagues.
He said that the learning programme was something “we can all be proud of”.
“It has been a great pleasure to see so many already signing up to the CPSP and receiving the learning material we meticulously put together for the benefit of our industry,” Tyler added.
John Somerville, head of financial services, professional education at the LIBF, continued: “This is a major step forward in supporting the industry with professional standards and complements the need to embed the higher standards required from Consumer Duty.
“The programme has been designed with lenders and brokers in mind. Ultimately, it will help them improve outcomes for clients in an ever-complex lending world.”
Martin Reynolds, chairman at FIBA, agreed that it was a “fantastic step forward for the market”.
“The level of work that Adam Tyler, whilst executive chairman of FIBA, Vic, the ASTL Team and John and the team at LIBF have put in to create this is phenomenal.
“I know how passionate they all are about this and whilst Adam may have recently stepped down as executive chairman his continued drive and support of this will still be evident in the market. I look forward to seeing all parts of the industry embrace this and begin to enroll both themselves and their staff on to the course,” he noted.
Don’t be afraid of the big, bad bridging loan – Jannels
But please don’t worry – I’m not having a crisis. I’m just proposing that we think differently about the way we approach the short-term mortgage sector. Within our industry, we can often get too caught up with labels and pigeonholing certain offerings or providers, when actually we should be considering the value of the solutions they are able to deliver.
‘Nobody wants a mortgage…’
It has been said, ‘nobody wants a mortgage, what they want is a home’, and a similar principle is true for bridging finance. Nobody walks into a broker’s office demanding a bridging loan, but it’s highly likely that you will encounter clients who have long-term objectives for which transitional finance is required to help them overcome a short-term hurdle.
In an uncertain economic environment like we have today, those short-term hurdles are even more prevalent. And this is precisely the type of solution that bridging finance can provide.
So, for example, the client may be refurbishing or converting a property, or perhaps they are using the time and money to address the lease extension required on a flat where the remaining lease term might otherwise be considered unmortgageable.
For homemovers, it could simply be the case that they are in a position where they need to complete on the dream home they want to purchase before the funds are released from the sale of their existing property. This is a trend that we are seeing in some volume at the moment as the lack of supply of new property onto the market means that vendors continue to be in a very strong position despite reports of more subdued sales activity.
Another trend, growing in prominence, is buyers who are using bridging to put themselves in this stronger position, when choosing to downsize from their current property. The wave of multiple interest rate rises in recent months have made servicing a mortgage more expensive for everyone taking out a new deal.
For those homeowners who may not have considered downsizing previously, remortgaging onto a higher rate, and much higher monthly payments, than they are used to can provide the stimulus to make them think about a move to a smaller property.
All of these circumstances are situations where ‘transitional’ short-term finance can play a key role in helping your clients to achieve their objectives and ultimately result in good customer outcomes as a result.
Nobody wants a bridging loan. What they want is a solution to help them achieve their goals, and bridging can, and does, provide an excellent tool to enable them to do this. The market has grown beyond recognition in terms of volume, influence and reputation over the years.
It’s highly competitive, customer focused and those lenders that are members of the ASTL commit to our strict Code of Conduct, which puts emphasis on high standards of transparency delivering the best outcomes for customers.
In helping clients to finance a period of transition, brokers can create new opportunities to provide a valuable service and open new doors for customers. So, don’t be blinded by labels – think about the solutions that would best serve your clients
ASTL and FIBA ask lenders to support education programme
The Certified Practitioner in Specialist Property Finance (CPSP) programme was created with the help of the London Institute of Banking and Finance (LIBF) and will launch in the first quarter of this year.
The associations are now asking the industry to support the development and delivery of the CPSP.
The budget has been finalised and ASTL and FIBA are asking for a one-off contribution to set the programme up. Supporting firms will receive three course membership places for free, representing a total value of £750.
Some members and partners have already pledged support, and the associations are calling on the assistance of others in the market.
Firms can support by visiting the LIBF website.
ASTL: CPSP ‘a long but exciting journey’
The digital programme covers 14 topics across the specialist lending sector and is followed by a two hour exam.
Adam Tyler, executive chairman at FIBA, said: “After many months of hard work from our 18 authors and question writers from across the industry on the 13 topics that make up the CPSP, we are nearing the conclusion of the programme. The LIBF are close to finalising each of the modules into a fully online format, that will be a fantastic addition to how we support both our members and our lender partners at FIBA.”
Vic Jannels, CEO at the ASTL, added: “This has been a long but exciting journey and I want to pay tribute to all of those who have been involved in delivering the CPSP initiative. I have every confidence that advisers will take the opportunity to take this qualification to demonstrate their commitment to high standards of customer service and competency.
“We have already had many pledges of support to help fund the cost of launching this initiative and are grateful to all of our supporters who are playing their role in helping to raise standards and advance the reputation of our industry.”
Bridging market sees strong growth in Q3 – ASTL
According to data from the Association of Short Term Lenders (ASTL), the value of completions came to £1.4bn in the three months to September. This was a 15.9 per cent increase on the previous quarter and was the sixth month in a row that the value of completions exceeded £1bn.
Compared to the same quarter last year, this was a 36.2 per cent rise.
The value of applications rose to £7.9bn, a 5.4 per cent uptick on Q2. Loan books also grew, with a 1.5 per cent increase to £6.1bn which was also a record high.
Looking at the same period last year, this represented increases of 21.5 per cent and 2.7 per cent respectively.
The number of loans in default declined by three per cent.
ASTL: ‘A strong set of results’
Vic Jannels, CEO of the ASTL, said the latest data showed “another very strong set of results”.
He added: “In fact, even amidst economic uncertainty, the value of loan books reached a record level of just over £6.1bn and this is the second consecutive quarter where total books have been more than £6bn. At the same time, the average LTV remains less than 60 per cent, which indicates that lending continues to be robust and responsible. The market is demonstrating its resilience and ability to serve a wide variety of customers with flexible short-term lending solutions.
“However, there are clearly economic challenges ahead and so it’s important that lenders continue to take a cautious approach to underwriting.”
Jannels said the association was helping the market to achieve sustainable growth.
He added: “Not only do our members commit to behaving in line with our strict Code of Conduct, but we are also working together with our colleagues at the Financial Intermediary and Broker Association (FIBA) and the London Institute of Banking and Finance (LIBF) to deliver the Certified Practitioner in Specialist Property Finance (CPSP) optional e-learning programme, which will cover different areas of specialist finance, including bridging and commercial loans, buy-to-let mortgages and development finance.”
Specialist lenders OSB Group joins ASTL
The ASTL has over 40 members and aims to “protect and promote the interest of its members and to give confidence to all parties who transact business with them”.
Members have to adhere to a code of conduct, which include acting in a professional manner, disclosing all costs and fees up front, not charging non-refundable fees which could be seen as “excessive”, following up customer complaints and not issuing terms or charge fees where they do not expect to lend.
Adrian Moloney (pictured), group intermediary director at OSB Group, is due to speak at the ASTL’s annual conference on 20 October, where he will deliver a lender’s view on the short-term finance market.
Moloney said: “We are delighted that the OSB Group has joined the ASTL. The short-term lending market has grown in strength and reputation under the guidance of the ASTL, which remains the leading trade association for lenders in the sector.
“This market has a great opportunity to provide finance solutions for an even wider group of customers, but it can only make the most of the opportunity if it continues to maintain high standards of customer focus and transparency and we are looking forward to playing an active role with the ASTL in helping to achieve this.”
Vic Jannels, CEO of the ASTL, added: “I’d like to welcome OSB Group as the latest lender to join the ASTL. We now have more than 40 lender members, representing the vast majority of recognisable brands in the short-term property lending market.
“OSB Group is a large, influential player that will help to give us a stronger voice in promoting the sector, engaging with policy makers and upholding standards.”