How do you feel about a robot, or robo-adviser, managing your money?
A recent survey carried out by ING suggests that 91% of consumers don’t want to leave the decisions on their finance in the hands of “robo-advisers”.
In the last few years, Fintech has become a more prevalent concept. We now have a robot mortgage adviser which claims to be the first in the world and the FT reported earlier this year that the banks are looking at using technology to reduce their costs.
Peer to Peer lenders are making use of technology to allow the general public to lend their money to businesses here and around the world.
n some circumstances, such as a mortgage or bridging loan, I can see the benefit though for the likes of development finance I think we are a long way off being able to rely on computers saying yes or no.
Most mortgages, when it comes down to it, are fairly simple. There are loan to values on the property being purchase, or remortgaged to give an idea of the maximum loan available. Then the income and expenditure of the applicant is taken into account to figure out what they can actually afford.
Assuming the parameters work for the applicant the application can get going. And, as long as
the client continues to make payments they and the lender need not talk again for perhaps 25 or more years.
You will know that developments are not quite that simple.
Lenders and clients need to be in regular, if not constant, contact over the period of the build. Lenders need to know that the works are progressing as agreed and in line with planning and building regulations. Clients need assurance that the draw downs they need to continue with a project will be on hand when needed.
Before technology can beat humans at underwriting and running a site it needs to react to the issues that occur when a project is underway.
Even the best builders and developers hit snags and, at the moment, it needs an experience person at the lender to react to that issue and find a way forward with the client to help ensure the project stays on track.
There are other elements to underwriting too, that perhaps requires a human to deal with. The joke “computer says no” has long been, and continues to be, a standing joke among those who have previously struggled to get finance for their project.
I’m no luddite, by the way, I have a mobile phone and everything.
If your project needs funding anytime soon and assuming you don’t have time for the robots to take over everything, then perhaps we should talk.
With over a decade of experience in working with clients looking to fund their construction, refurbishment or conversion projects, I can look at a project and give you a good idea, very quickly of what might be available.
To discuss your project funding needs, give me a call on 01492 233 999 or drop me an email at tim@volofs.co.uk .
