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Why do lenders say no?

No one likes receiving a ‘no’ to a funding proposal and certainly not a ‘slow no’ after investing time and effort in trying to push what turns out to be a half-closed door at the outset. So, why do lenders so no?

Here head of property funding at Cowgills, David Rainford, explains more.


Why do lenders say no?

Sometimes a ‘no’ is justified because the proposal is not clear, targeted at the wrong lender, or quite frankly poorly put together often due to time constraints or not having a full appreciation of what information a lender needs to make a proper assessment.

Working with the right partner from the outset can have benefits and I have shared below what I see as the key advantages and also what a client should look for when choosing an advisor:

– An advisor should prepare a well presented and factual funding proposal which provides the right level of information for a lender to make a decision.

– Be prepared for a lot of questions and to an extent challenge. An advisor who does not do so probably does not have the right experience or metal which will be needed along the way in any funder negotiations.

– Honesty to me is paramount. If a proposal is challenging or needs reshaping an advisor should be up front with the borrower. Frank discussion and debate is good and the last thing a borrower needs is for an advisor just to agree with them.

– A funding partner should be chosen like any other professional advisor i.e. they have experience on similar projects, perhaps come with a personal recommendation and can demonstrate they have the right funding relationships at the right level.

– An advisor should be transparent in their dealings and agree with the client which lenders are to be targeted. The advisor should effectively work as part of the borrowers’ in-house team and therefore be impartial without any conflicting agenda. The client therefore knows his proposal will be aimed at the most appropriate lender(s) and therefore have the best chance of success.

I am not implying that advisors have a magic wand, but the funding market is fast-changing and therefore there are real advantages of being able to tap into knowledge and experience of the market as well as working with a partner who understands property and property finance. No different from using the right planning consultant or architect on a scheme!


About Cowgills Property Funding

At Cowgills we pride ourselves on adding value in our relationships and above all being honest and straight talking in our dealings, working alongside our clients to get the best outcomes.

As Property Finance Director at Cowgills for the last 10 years and with over 30 years in banking and property finance David has a depth of experience and unrivalled contacts in the funding market.

But don’t take our word for it. Paul Mathison, Director and Group Chief Executive at Create Homes says:

“Cowgills provide more than just a typical broker service. They truly understand our vision and are a key part of the team. Alongside our consultants and other professional advisors, we appreciate their ‘value added’ approach to the business. Dave has an unrivalled knowledge of the sector, strong relationships with funders at the right level and is always on hand to provide guidance and advice.”

Please contact David on 07794 490682 or David.rainford@cowgills.co.uk  for an exploratory chat.

Why do lenders say no?

The information was correct at time of publishing but may now be out of date.

Posted by David Rainford
21st June, 2021
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