We need an active and dynamic trade association, writes Steven Nicholas, chief executive of Tiuta
Something the new chief executive of the Association of Short Term Lenders (ASTL) said this week struck a chord. Speaking about his appointment, Benson Hersch, said he had been moved to apply for the position by the fact that he felt the bridging industry is under-appreciated and that it is the role of ASTL to correct this. I wholeheartedly agree with both these sentiments and it is crucial that the ASTL helps further the cause of its membership, but it is the acknowledgement of what the bridging market is achieving that really sticks in the craw.
The fact that the sector has its own trade press and garners many column inches in the mortgage media – as well as its own awards ceremonies – is proof that it is an industry on the rise, but it still feels like there is a certain lack of acceptance from certain quarters of the financial services market. It is similar to the way that the non-conforming sector, despite the valid role it performed in helping near-prime borrowers on to the ladder, was always regarded with a certain snootiness from some quarters. Some areas, such as equity release, has almost been treated as an outcast because of a reputation garnered in a bygone era by products which are nothing like today, rather than an appreciation of what the market is achieving now.
A sector’s past can of course be a millstone around the neck and I’m sure that the reputation that accompanied bridging from years ago is still often uppermost in many of the nay-sayers’ minds. The fact is that bridging is in a far different place to where it previously sat and, while we admittedly have much reputational work to do as an industry, it is true to say that we are moving forward (albeit slowly) in the right direction.
This is where an industry trade association like the ASTL needs to grasp the nettle and (to mix my metaphors) get on the front foot as soon as possible. I sense that many of those who bash bridging sense that we are a divided industry at present and the ASTL should be going a long way to dispel that perception.
It may be a perceived lack of formal regulation that leads some to dismiss the bridging sector’s achievements, but this is a simplistic view that fails to acknowledge the standards and ethics that are already in place. Leaving aside the fact that a number of bridging lenders are now FSA authorised, short- and medium-term lenders are beholden to a number of codes and procedures and just because the FSA doesn’t issue these, it doesn’t make the sector lawless or unscrupulous. The buy-to-let market doesn’t come under the regulator’s jurisdiction yet you rarely hear any accusations thrown its way, which is particularly galling given that it the finance made available by bridging lenders which is helping it enjoy such a purple patch.
The bridging sector apparently celebrated reaching the £1 billion lending landmark recently and, even if this has been deemed by some as PR ‘fluff’, as an industry we should be able to hold our heads high and be proud of all we have achieved rather than fighting off the brickbats – be they be from inside or outside the industry. Given the high-street lenders’ continued difficulty in sourcing funding, it could be argued that were it not for the bridging industry, the mortgage market would be in a leaner state than it currently is, so some appreciation and acknowledgement of this fact wouldn’t go amiss.
There will always be those who fear something new and unknown, but one thing that is for certain is that the bridging industry is here to stay and the ASTL has an extremely important part to play in helping to drive the sector forward. Benson will have a little time to bed in but we definitely need an association which is not perceived to be asleep on the job.