That was an increase of 7.4% on 2016 and the highest number since 2006, according to UK Finance.
This rise is despite the fact that the number of mortgage approvals have been steadily declining over 2017, falling to a three year low in January 2018.
With an increase in the number of younger first-time home owners, the mortgage application system needs to be reimagined to accommodate changing consumer demands.
Customers wanting to get on the property ladder and snap up their dream home do not want to be hindered by lengthy application processes.
The search for the right lender no longer requires hiring an agent for a fee: a quick google search is enough to scope out the options available.
There has also been a recent rise in internet brokers who use technology to make finding and applying for a mortgage much quicker and more streamlined.
Digital dawn stoking competition
The surge in mortgage applications, combined with evolving consumer demands, has also contributed to increased competition between mortgage lenders.
With Open Banking launching this year, banks are increasingly engaging in third party partnerships to enable customers to use their banking app for services including mortgage processing.
This competition also means that besides constantly updating their product offerings, lenders need to focus on providing a quick yet enhanced customer experience.
Speed of application
To manage the high demand in mortgage applications, major banks and mortgage brokers are also looking to reduce mortgage processing time to ensure seamless customer service.
The current system can take between 18-40 days to vet a single mortgage application, resulting in a heavy lag in the system.
Given the nature of the process, mortgage applications go through thorough assessment and valuation before an offer can be made.
This repetitive paperwork to evaluate the applicant’s employment, income and assets as well as the information about the property is time intensive.
The application also goes through a lengthy underwriting process which leads to longer handling times, which can lead to an increase in customer dissatisfaction.
A paradigm shift to automation
A shift to automation for application processing not only leads to quicker applications (down to 48 hours or less) but also increases efficiency in the mortgage application cycle, with higher levels of accuracy.
Automating these services enables lenders to understand application arrival patterns, forecast application flow, support resource planning and benchmark performance statistics.
With the systematic automation of back-end processes, lenders can focus more on the customer experience and keeping customers fully-informed and satisfied throughout the process.
The increase in demand accompanied by the rise of competitors in the market highlights the need for increased adeptness and care for customer satisfaction.
Automating processes will enable lenders and brokers to achieve not only increased efficiency in application processing but also equip them with the right tools to address changing consumer needs.