MS Leader: Beware a bridge too far

12 December 2011

Chief among them was a warning from the Financial Services Authority at November’s Mortgage Buess Expo to any brokers providing bridging. This was followed by a £28,000 fine to non-advised brokerage Fastmoney for failing to ensure clients who took out mortgages and bridging loans were treated fairly. As well as being banned, Fastmoney’s chief executive was personally fined £17,000. Clearly the FSA means business.

All regulated advisers then should heed last week’s warning by the Association of Mortgage Intermediaries on unregulated bridging firms encouraging brokers to adopt questionable practices, such as using such firms for regulated bridging deals. Obviously +not all should be tarred with the same brush. Bridging fills a vital niche, especially in the current market and done properly it gives a happy outcome for all.

But as a regulated intermediary, you and your clients potentially have the most to lose if you place them on deals that are not appropriate to their needs. While the fees for bridging may be attractive, you could end up paying a heavy price if a specific deal loses you your licence. The FSA has made it clear that it will come down hard on anyone it deems to have breached its guidelines. Don’t make yourself a target.

Finally, this week’s column on page 23 from our Irish correspondent Anthony Garvey is unfortunately the last we will publish from him as sadly he recently passed away. Garvey has written about the trials and tribulations of the Irish market for Mortgage Strategy over the last year and before that was a regular contributor to the monthly magazine Lending Strategy.

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