A bigger kitchen does not make you a better chef. You can fill every cupboard and get the best kit money can buy, but if the menu hasn’t changed, you’re still serving the same food.
Funding can work like that. A lender announces £50 million, £100 million or £250 million of new money and the natural reaction is that they can suddenly do much more. Well, can they?
If I were a broker reading one of those announcements, I would want to know what has fundamentally changed. Can the lender now consider cases it would previously have turned down? Has its appetite widened? Does it have greater capacity to make a judgement call when a deal doesn’t fit?
The latest BDLA figures make those fairly sensible questions to ask. Bridging applications fell 26.3 per cent quarter-on-quarter to £7.3 billion in Q2, while completions dropped 15.2 per cent to £1.6 billion.¹ There is still plenty of business being written, but applications are subject to more scrutiny and lenders are working harder for the right deals. Having money available is one thing, but being able to put it to work across a useful range of cases is another.
WHAT SITS BEHIND THE MONEY?
I’ve seen plenty of lenders announce a new funding line and present it, quite reasonably, as evidence that they are ready to lend more. Yet if the facility comes with broadly the same credit parameters as before, another £100 million may simply increase the volume of business they can write rather than change the type of business they can consider.
There can, of course, be useful improvements within a new facility. Dual representation might become possible, AVMs might be permitted or certain criteria could be widened. But those details tell you far more about what has changed than the size of the facility itself.
Brokers don’t necessarily see all of this because they deal with the lender rather than the funding structure sitting behind it. Yet that structure can have a considerable bearing on the answer they receive when a case lands on the lender’s desk.
THERE CAN BE STRINGS ATTACHED
The cost of funding is only one part of the equation. The terms on which that money is provided deserve scrutiny too.
Institutional facilities can carry utilisation requirements, controls and defined credit parameters. They have supported a huge amount of growth across specialist property finance, but lenders still have to operate within the terms they have agreed.
Take utilisation. If there is a financial cost attached to not deploying enough of a facility, that has to be managed as part of running the lending business. Equally, money allocated to a facility cannot suddenly be used for a property type or borrower profile sitting outside its criteria simply because the lender likes the deal.
None of this makes one funding model inherently better than another. Two lenders can have exactly the same amount of money behind them and still have very different levels of freedom over how they lend it.
A DIFFERENT POSITION AT INSPIRED
Our position at Inspired Lending is slightly different. We remain 100% funded by Pears, so we are working with the same private funding relationship that already knows our business and how we approach credit. The change has been the cost of that money, which allows us to price more competitively without introducing a new funding structure behind the scenes.
A good deal should be priced like a good deal. If the risk warrants a sharper price, we now have more scope to offer one. If the case carries additional complexity, we can assess what is actually in front of us and price for that risk instead.
It means brokers do not have to choose between coming to us for flexibility or looking elsewhere for competitive pricing. We want to be considered for both the case that needs some thought and the strong, straightforward deal where price is likely to play a greater part in the borrower’s decision.
ASK WHAT HAS ACTUALLY CHANGED
This is why I think brokers are entitled to look beyond the size of a funding announcement. When a lender secures another £100 million, ask what it can now do with it. Has the credit appetite changed? Are more property types available? Can the lender consider a broader borrower profile?
And perhaps the best question of all is what happens when the deal changes halfway through. Bridging has a habit of testing the original plan, and that is often when you find out how much room a lender really has to make a decision.
More capital coming into specialist finance is good for the sector, and nobody is going to complain about lenders having more money available to support borrowers. But the number on the funding announcement is only the starting point. You can build a bigger kitchen, but in the end, I still want to see what’s on the menu.
Gavin Diamond is CEO at Inspired Lending
Source: ¹ Bridging & Development Lenders Association, Q2 2026 lending data
