When Titlesolv and London & European combined towards the end of 2013 to become the UK’s leading title insurance and indemnity solutions provider, we could not have predicted how quickly the market would expand in the course of just 12 months, or the potential regulatory change facing the bridging finance industry. 

Being able to move nimbly and therefore respond quickly to new developments in the industry is one reason why Titlesolv has had such a strong first year. We are well ahead of our objective to triple in size by the end of 2015 and by the end of this year the size of the original team will have doubled. As a result of this growth, we recently relocated to expanded office space in Fenchurch Street. The new location represents roughly a doubling of work space and embodies our increasing optimism in the strength of the market in the months and years ahead. 

This is a particularly exciting time for Titlesolv, and not solely because of ongoing internal expansion. As a result of increased understanding of the role of bridging finance, its use amongst brokers and investors is growing. In 2012, it surpassed the £1 billion barrier for the first time, with gross lending jumping 24 per cent for the 12 months to July 2014, according to recent data published by West One Loans. There are new players, new products and improved accessibility. This is obviously fantastic news for the industry; however, its accelerated growth has thrown a spotlight on the market, with the threat of potential regulatory change meaning that it is now more important than ever to understand the associated risks and how best to mitigate them.

In September, the Financial Conduct Authority (FCA) expressed its concerns with the exponential growth of the market post-April’s Mortgage Market Review. There are suspicions that bridging finance is being used in some cases where a mortgage has been denied due to the tougher regulation.  If the FCA goes ahead with an investigation, and determines that bridging finance is being used inappropriately, then it could introduce regulation to restrict access to certain categories of borrowers, thus eroding the positive strides the industry has taken over the past few years to fill a genuine gap in the market where, previously, high street lenders feared to tread. Further, the operational costs of supporting greater regulatory controls would inevitably be passed on to borrowers. This would signify closer alignment and competition with high street lender product offerings.  

There is no doubt that a potential regulatory shift could represent a huge sea-change for the UK’s bridging industry and they will undoubtedly herald further changes for the industry’s major players and for the market as a whole. We look forward to being a part of it.

Christopher Taylor is Chief Executive of Titlesolv, a leading risk management provider for the property market.