Experts underline importance of sufficient sector knowledge
A recent study has found that more than eight in 10 brokers offer bridging finance to their clients, even though some have limited knowledge about the sector.
The survey, which was conducted among more than 500 brokers, revealed that 83% of brokers offer bridging finance, but only 67% claim to have at least a good knowledge of the sector.
According to the research published by Brightstar Financial and West One, 27% of brokers claim to have ‘excellent’ knowledge of bridging, 40% claim to have ‘good’ knowledge of it, while 23% say their knowledge is ‘average’ and 10% admit that their knowledge of bridging is ‘poor’.
When asked whether they currently refer a client to a specialist distributor when their client’s bridging needs fall outside of their knowledge area, only 45% of brokers said they did, with 55% saying they did not.
The research found that purchasing a property at auction is the most popular reason for brokers recommending bridging finance, with 85% of brokers considering bridging in this situation.
Three-quarters (75%) said they would recommend bridging for property chain break and 73% said they would recommend bridging for property conversion. Just over half (54%) of brokers said they would consider bridging as a short-term cash flow solution for their clients.
Michelle Westley (pictured), head of marketing at Brightstar Financial, underscored the importance of brokers having the right level of knowledge about the sector to ensure their clients are achieving the best outcomes for their circumstances.
“From this research, it looks like many brokers are offering bridging without even claiming to have a good knowledge of the sector, let alone an excellent knowledge. What’s worse, is that more than half of brokers admit to not engaging with a specialist distributor when their client’s requirements fall outside of their area of knowledge,” Westley said.
“Dabbling in any market is dangerous without an in-depth working knowledge of the sector and we would always recommend that brokers who do want to offer bridging to their clients, partner with a specialist that is fully immersed in the market,” she stressed.
Aisling Birch, partner marketing manager at West One, echoed Westley’s view that sector expertise is paramount for good customer outcomes.
“Brokers should make the most of the resources available to them to stay on top of the key considerations and opportunities for their clients. This includes making use of educational material, such as webinars and guides, as well as engaging with lender BDMs to help them with specific questions,” Birch said.