Eliminating the piles of paper typically created by a mortgage transaction should be an industry priority. Our processing department tell me an average file contains 53 sheets of A4: photocopies of life proposals, applications, personal documents and so on. The extent and cost of these files is unbelievable ‘ we are thinking of moving into an empty aircraft hangar. So much for a paperless world.
At a meeting with Easyjet’s chairman and his management team, I heard Stelios had just three rules: ‘No Paper. No Airmiles. And No Rules.’ I will not explain the latter two, but can confirm the first of these three rules is upheld rigorously. All inbound post is scanned and distributed electronically ‘ recipients never touch paper. The result is a business which appears to be trading electronically. So why is the financial services market lagging so far behind, given that the necessary technology seems to exist?
Is it a lack of appetite for significant change? Lenders would face a huge cost if they were to outlaw paper and shift to document imaging. And crucially, brokers do not invest in the appropriate hardware.
Technology providers like Trigold and MBL are going some way to drag our industry from the dark ages, by promoting and facilitating electronic submission of mortgage applications. We have invested thousands in establishing our electronic submission platform in partnership with IFonline/Trigold.
Stuart Bryce, a mortgage consultant in Derby, comments: ‘I have submitted cases electronically this year to Bank of Scotland, one of which was processed quicker than a postal application, knocking about five days off the usual turnaround. Other e-applications to lenders were not so quick. If a lender does not have the resources to process cases quickly, it does not make a blind bit of difference how the case is submitted.’
Similar concerns are raised by mortgage consultant Graham Tate of Wakefield, who says: ‘Instant electronic submission is one thing. However, we are still restrained by the postal system in terms of submitting other accompanying documentation, which lenders still require. There is also clients’ concern about the security of the information being sent electronically.’
I cannot wait for the day when the market scraps paper applications in favour of e-trading. I urge brokers to press lenders hard and demand they support true e-trading as fast as possible. It will save you and your clients hours of donkey work, reduce duplication and errors, accelerate the transaction and ultimately reduce costs for everyone in the food chain.