In an interview with Bridging & Commercial, Daniel discussed the changing role of a BDM, challenges for the bridging market and consolidation.
You recently decided to relocate to London. Why did you make the move and how will you be looking to build stronger relationships with broker partners?
Well, I was always going to be relocating to London this year. I was previously a BDM in London for about a year-and-a-half when I initially came on board with Affirmative. I decided to make a move back to Manchester just to gain more experience within the realms of bridging finance by spending more time in the office with the underwriters and also spending some good time out on the roads with our operations director Ian Harrison. I will be looking to build stronger relationships with broker partners delivering solutions, service and showing them just how versatile our products can be. Affirmative has a great presence across the UK and this industry is countrywide — so I guess wherever I am, so is our customer base. I suppose in reality I have relocated to London to strengthen our presence in the South West, South East and generally where we are doing some great business with our broker contacts.
How has the role of a BDM changed in recent years in the specialist finance market?
I can’t speak for any other BDMs here but, for myself, I’ve noticed broker firms being a lot more receptive to the idea of a bridging/development finance lender going in to visit and run through exactly what it is that we do and why we are refreshingly different to others. When I first started out as a BDM only a couple of years ago, I would cold-call brokers to see if they would like a BDM visit, and more often than not I would get a response along the lines of: “We don’t do much bridging, so it’s not really worth you coming all this way.” So things have definitely changed in that respect.
The whole sector and property market are changing and the need for short-term money is clear, especially with the main banks appearing still to be relatively lending averse. There’s a need for bridging — because of several of the niche areas we cover, brokers are even more receptive and keen to chat through the potential options with me.
We’ve seen a large influx of new lenders into the bridging market. Is there room for more or will we see consolidation this year?
The market has changed and is continuing to do so. We are not fazed by the P2P challenge or any other group of competitors. In fact, we love competing for business because it makes us keen, keeps us on our toes and efficient.
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However, I am truly concerned [whether] new entrants are lending ‘other people’s money’ without careful or appropriate regard for the fundamentals of lending, which — as a family business — we do at Affirmative, having had it drilled into us. Those fundamentals are a great discipline for good lending and commonsense business ethics.
There is a need for even more care and control from the industry watchdogs.
I think more likely than consolidation is that there will be casualties, unfortunately. The room for all lenders will expand and contract with the market — and that market is currently both uncertain and very fluid.
If you could change one thing about the bridging industry, what would it be?
The market needs more transparency so that clients are aware of all costs and don’t get pulled in with cheap headline rates with a much higher overall cost. And much of what I said above applies — regulation is present, but more policing of bad lenders and brokers would be good.
What do you expect will be the biggest challenge for the bridging market this year?
Brexit and its effect on the economy will drive the mortgage industry, and the property market will be in a state of flux. That is obvious to all of us.
We will keep lending carefully where commonsense deals are available, but if they are not, then we will sit back and keep our powder dry. The beauty about this business is that if we do not like the look of a deal, we do not do it — we are not on a hamster wheel, like so many others are, having to lend to put bread on the table. That is a recipe for disaster, as we have seen only too clearly in recent days. As a family business, we are not here to take on foolish risks and we will not do so.
How did you get into the industry?
At 17, I was working in telesales, then I spent a couple of years working in Australia and seeing a bit of the world. When I came back to the UK, my aim was to understand property, first in rentals, then in sales and that naturally progressed into finance.
Having both a father and an elder sister working in the industry for a number of years, I guess it is in my blood. I was brought up hearing about the industry and the passion which they both have for it. The pull was too great, and I am also developing that same passion as the months go by.
If you didn’t work in finance, what would you be doing?
If I didn’t work in finance, I would most likely be pursuing a career as a healthy gourmet chef! I love cooking and I am very into health and wellbeing. I was also a pretty decent DJ back in the day, so maybe a career in music? My dad always wanted me to have a go in that area … I guess it wasn’t to be.