Bridging is not for the faint hearted, with its rate wars, heady LTVs and break-neck speed completions. However, without caution, this speed can lead to a harsh fall for all involved.

The onus of caution lies in the responsibility of all involved, especially the lender, performing sufficient due diligence, and the broker, ensuring the deals they place to clients are as good on the surface as they are at their core.

When it comes to a lender's responsibility, Andrew Lazare Director of short-term lender Mint Bridging said. "In the current climate where brokers are looking for immediate decisions on loan enquiries, it is crucial to try and balance a quick decision which broker can rely upon whilst at the same time taking the necessary steps to ensure that the loan is properly underwritten and the appropriate risks managed and mitigated.

"There are many lenders out there who send out decisions in principle subject to credit committee approval and other such factors.

"Whilst on the face of it these are done quickly the reality in many occasions is that the loan will not have been approved at credit committee level and may be subject to amendment or withdrawals at a later date.

"At Mint Bridging we have our own in house asset managers that prepare desk top appraisals on each enquiry that our BDM's wish to progress. Our asset managers can quickly form a view on the property being used as security for the loan whilst our underwriters review the credit profile of the borrower and investigate matters such as affordability and exit strategy

"We believe it is also paramount to meet the borrowers and visit the properties to reduce the threat of identity theft and valuation fraud both which costs the industry millions of pounds per annum.

Andrew explained how Mint Bridging's growth of enquiries has invited new introducers, often wanting terms in a matter of hours, which cannot always be the norm.

He said: "There is a balancing act to asking the right questions and making the right lending decisions, This often takes some time and requires thought and logic.

"By way of an example, an enquiry came into us on Saturday morning to re-bridge an existing bridge, our asset manager viewed the property and met the borrower at 1pm Sunday and legals were instructed 8am Monday. The loan will complete on thursday.

"Similarly, we are working on another loan where there are contamination issues, planning issues and the valuation report alone is 145 pages. It’s impossible to rush that enquiry as the risk Is a lot higher....we told the broker that if he wanted a quick decision the simple answer will always be no.

Andrew concluded: "Brokers have to accept that sometimes things take time and a reliable decision takes time."
Russell Martin Managing Director of distributor Finance for Business said: "From a broker’s perspective, we relish receiving an enquiry that is time sensitive and requiring a quick completion. However, only one in five completions is truly driven solely by timescales.

" Our completion averages for bridging finance have extended by a week when compared with 2012 figures, purely because of the changing landscape of bridging finance and the increase in facility types and terms available to us and the client. We establish timescales with the client or introducer at a very early stage and ensure the proposed lender is fully aware of expectations. This allows the lender to prioritise the urgent cases and ensure the very time sensitive deals are dealt with accordingly.

"As a packager we are acutely aware that we are in danger of becoming a ‘post box’ for fraudulent deals. If we receive an urgent bridging loan requirement from a party that we have not dealt with before we will look at the deal very closely at the onset, in particular when the security is unencumbered.