Martin's Blog: Telling it as it is

Martin's Blog: Telling it as it is


The Council of Mortgage Lenders (CML) has spoken. Silent on bridging for too long, the lending industry’s senior trade association last week issued a comprehensive statement on the state of bridging and its prospects in the years ahead. Its view appears to have polarised the sector.  

For my part, I welcome the CML’s intervention. It is a deeply experienced and well-organised trade body, and one that enjoys broad support and trust from its membership. Having helped the industry adjust to life under what, at times, has been a challenging regulatory regime - not to mention the booms and busts so imbued in the UK property sector - it is in a strong position to cast judgement while offering advice. 

The introduction to its statement sets the tone for what follows. Part of it reads: “We support a sustainable and well-run bridging market. At its best, bridging can act as a lubricant to the wheels of the housing market, enabling chains and transactions to complete when they would not otherwise do so, and speeding up completions. But we believe it is important to think about how bridging fits into the overall mortgage jigsaw, alongside mainstream lending and buy-to-let. The fact that regulators are concerned enough to have issued some stiff statements suggests that caution is needed.” So far, so good.

What follows is a summary of the purposes served by bridging, a description of the make-up of the sector, regulatory concerns and the future for bridging. It’s all measured stuff rightly observing that bridging is expanding when other lending sectors are contracting, providing vital liquidity when and where it is most needed. But it doesn’t shy away from identifying a number of issues which it does clearly, accurately and, in my view, fairly. 

Some have questioned the CML’s right or fitness to comment on bridging. My response is to say it not only has every right but has, in fact, an obligation. As the CML statement acknowledges, it counts among its considerable membership a number of bridging lenders. Having made a deliberate choice to become CML members, they have every reason to expect their chosen trade association to speak publicly on issues of direct relevance and interest.

As a bridging lender, I share many of the concerns raised by the CML. None of them are beyond our wit and capabilities to resolve but we ignore them at our peril. At the very least, they merit sober, mature consideration and debate. Simply pretending everything is rosy in the garden isn’t sufficient.

That said, I’m one of the first to acknowledge the great strides taken in recent years to improve practices in the short-term lending sector. While sharp behaviour doubtless still exists, I venture to suggest it is largely confined to the periphery. Among the main players, both intermediaries and lenders, standards have risen and continue to do so. For this, the industry should be applauded.

A significant advance has been in the establishment of new trade bodies to represent the growing number of bridging practitioners. While in many regards still finding their way, they promise to bring to the sector the same level of professionalism and assistance now provided by the CML to the far larger mortgage industry. By speaking out now, the CML is doing us all a service.


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