Speaking to Mortgage Solutions, Colin Fyfe, chief executive of Hinckley and Rugby Building Society said the mutual was “keen” to work with Pexa as he felt the part of a mortgage which rested with HM Land Registry was under-invested. He said he wanted to make sure “digitisation was not just going to be words, [but] would become a reality”.
The transaction completed on 7 September following a nine-day timeframe from when the mortgage offer was issued.
It was also completed using Pexa Pay, which is now the seventh active payment system in the UK and has the Bank of England acting as the settlement service provider.
Fyfe said the borrower was surprised at the difference between the remortgage process this time and the last time he refinanced as that took five months. Fyfe also said the ability to provide certainty on how long the remortgage would take added transparency to the process.
‘Amazon style’ experience
David Jabbari, chief executive of Muve, said it was “an odd thing” that a “nicely controlled process” like a remortgage turned into a lottery once it got to the conveyancing stage.
He added: “I’m not damning my profession. But I think we all accept that there are significant problems in the conveyancing side.
“I think what’s really great about what we’ve done today is we’ve started that journey to bring some of these more modern Amazon-style customer, retail experiences into the conveyancing process.”
When asked how the market would react to the new technology, Jabbari said the conveyancing sector sometimes lacked the ambition to change things, but with Pexa’s reputation of already doing this in Australia and completing a transaction with Hinckley and Rugby, the sector could start to embrace change.
Pexa facilitates 97 per cent of remortgages in Australia and around 85 per cent of purchases since launching in 2010.
Fyfe said lenders had also held back when it came to innovation and were happier to digitise the front end of the mortgage process but neglected the back end. However, he said Pexa could be a catalyst for a shift in the market.
Hinckley and Rugby Building Society did not work with a broker to complete the transaction, but Fyfe said that was the next step now the first transaction had been completed.
Regarding its pipeline, Fyfe said some remortgages were already being processed so were not being conducted using Pexa but others would be where appropriate.
Expanding its footprint
The Bank of England previously allowed Pexa to have seven testing slots to trial its technology with lenders in the UK and this has since been upgraded to enable a further four.
It expects its technology to go test and live with Shawbrook next month, while the other lenders will be onboarding throughout 2023 before Pexa makes its proposition available for purchase transactions.
James Bawa, chief executive of Pexa UK, said: “Our mission is to transform the property market for consumers, lenders and conveyancers. The completion of the UK’s first digitised remortgage transaction marks a major milestone in this journey, and acts as a tangible proof of concept for the wider industry.
“The successful launch of our new platform is a testament to the openness to innovation and collaboration we have seen from the government, Bank of England and the wider lending and conveyancing industry in the UK. Not least, Hinckley and Rugby Building Society, which has provided early and consistent support, and is now the first to benefit from our platform.”
He added: “This is just the start. We have invested significantly into the UK to develop and embed our technology to help drastically improve the remortgage process. We know from the Australian experience just how significant and widespread this transformation can be.
“We will continue to invest and work with industry to roll out our platform more widely, so that we can help bring about better consumer outcomes, making a stressful and delayed remortgage process a thing of the past.”
