Bridging finance specialists weigh pros and cons of AI

The opportunities and limitations of AI, and the growth potential of the bridging market, were among the key topics tackled by panellists on the second bridging finance panel at the Finance Professional Show.

Moderator Nicola Firth, founder and CEO at the Knowledge Bank, heard from bridging finance specialists on the panel about how they are using technology, such as AI, to address inefficiencies and reduce lending decision times.

However, some speakers urged caution about deploying AI and insisted that the human touch is still required in bridging finance.

AI versus human touch

Erbil Erbil, senior business development at Bridge Invest, is using AI to generate quotes more quickly and, ultimately, reach lending decisions faster. He also predicted that next year, AI will be deployed for underwriting.

Joshua Field, COO at Albatross Lending Group, noted that AI had enabled him to “optimise time” and meant that he can review a case in just five minutes, down from one hour.

While risk decisions remain with its underwriting and credit team, Joshua questioned whether those lenders not already looking at AI may get “left behind”.

Other panellists suggested that humans are necessary in the lending decision process and for critical thinking and insisted that AI will not replace relationships.

Sally Precious Ward, intermediary sales manager at Together, noted the positives and negatives of AI. Among the positives, she said that AI is helping her to summarise valuation reports.

But, she also warned of AI’s ability to generate “very realistic” fraudulent documents, such as bank statements, and emphasised the need for financial crime teams to step in and assess the risks.

Going mainstream

The panellists also considered which bridging deals that are currently considered specialist might become more mainstream in the future.

Gavin Diamond, CEO at Inspired Lending, said the firm had launched a revolving credit facility earlier this year. Since then, the business has received enquiries about this product with a view to understanding more about it, as people look to release equity from existing properties and portfolios.

Sally agreed that revolving credit facilities will become more popular and common in a market where values have dropped.

Erbil suggested there is “massive upside to grow in terms of bridging’s share of the mortgage market”. He predicted that the market had the potential to double in size over the next ten years.

Raphael Benggio, director of bridging at MT Finance, observed that more people are turning to bridging as “a useful tool”, particularly for inheritance planning and among expats as well.

He said that, when rates are higher or there are market challenges, bridging has a role to play to allow “breathing space”.