In today’s specialist lending market, no two cases are alike, and lenders who rely too heavily on tick box criteria often miss out on quality borrowers with strong potential. This is where the expertise of individual manual underwriters makes its mark. If you can be rigorous in your assessment, complexity turns a red flag into an opportunity to look more closely at a case.
When a team has in-depth cross sector knowledge, spanning commercial, residential and specialist, it can cope with any deal ambitious clients might present. For example, lenders with the expertise to interrogate a cashflow model, interpret past trading figures, and ask the right questions when a case does not fit neatly into a standard credit framework will always offer a real partnership. That level of industry knowledge can get deals done that might never make it past the first gate elsewhere.
Working the case
We recently agreed a facility for an early stage company with a limited trading history. The business was led by directors with a demonstrable track record in an adjacent sector, and while the application was predominantly projection led, the cashflow assumptions were grounded in realistic metrics. Our relationship management team worked with the broker and client to structure a facility with milestone based covenants to manage risk and support the business through its growth stages. It was not just a leap of faith, it was a calculated, logical decision made possible by attention to detail and an experienced eye.
Equally, young businesses, especially those run by ambitious and capable founders, should not be excluded from borrowing solely due to their age. Lenders should consider broader factors like sector experience, personal equity invested, and the strength of the business plan. And while a good plan can be written by anyone with access to a templated tool, it is important to test the assumptions behind it. That means analysing the market context, competitor landscape, and how cashflow stands up under pressure. When done properly, it gives a clearer picture of risk and more opportunities to lend.
Even if other lenders have declined a case, all lenders operate differently, so that may not be relevant when taking a second look. That might involve reassessing a credit profile in light of new information or considering different disposal strategies for asset backed loans. A recent case involved a portfolio landlord turned down by another lender due to an impaired credit history. Our team engaged fully with the client and broker, understood the reasons behind the issues, and agreed a revised structure with enhanced security. That deal completed within weeks.
Another example involved a large buy to let portfolio. The original lender had taken a narrow view, basing its valuation on a forced sale of the entire portfolio. This time, the approach was to consider block by block disposal, based on a realistic sales period of up to 12 months. It required patience and a more nuanced underwriting lens, but ultimately led to a higher debt quantum and a viable deal.
Strength of funding
As a lender, if your group funding position is strong and you have a growing deposit base, it brings more agility to operations than a simpler funding line. Equally, the growth ambitions of a lender play into a willingness to consider strong lending opportunities, even when they fall outside the norm.
But it is not just internal experience or capital that gets a case over the line. Brokers are a critical part of the equation.
The more clearly a case is packaged, with honest disclosure, complete documentation, and a compelling rationale, the faster the decision can be made. Brokers who know their clients well and anticipate the questions we will ask create momentum. And in a complex case, momentum can make all the difference.
That does not mean compromising on credit quality. It means lending with logic, backed by real world understanding, and a belief in the potential of the borrower.
In the end, lending is a partnership. When brokers and underwriters work together, asking the right questions and bringing creative thinking to the table, we unlock deals others miss. And in a market where appetite is tightening and clients are navigating increasing complexity, that collaboration has never been more valuable.
