But whether is this a result of consumers demanding faster turnarounds or companies flexing their muscles is up for debate.
This week, Mortgage Solutions is asking: Have you noticed an increased pressure from borrowers when it comes to how quickly a mortgage application is processed and why do you think that is?
Society today relies heavily on technology and this has been creating a ‘have it now’ attitude among consumers.
Many clients underestimate the volume of work that goes on behind the scenes in order to achieve a mortgage offer and can therefore find it hard to understand why there can be delays in the underwriting process.
With purchases, particularly residential ones, there is an emotional cost to both the client and vendor. They are making life changing moves which depend on the success of a mortgage application and one hiccup in the process can adversely affect the lives and dreams of an entire chain.
This is where good advice, packaging and, crucially, feedback from a broker becomes key.
The sooner we can achieve a positive result, the closer families get to moving into their home, as has always been the case.
The current economic climate has created a buyers’ market, and this has also had an impact on expectations, particularly from vendors and estate agents who are keen to see the purchase go through quickly and without issue.
Our role as brokers is to take away some of the stress that is involved in one of the largest financial transactions of a client’s life and the more efficiently we can do that, the better for all involved.
There are several factors that will play a part in driving the demands of borrowers.
First, market conditions: The laws of supply and demand have played a part in increasing the pressure on borrowers to want a mortgage offer out quickly.
Stiff competition means purchasing a property is a time sensitive transaction, with many sales being negotiated on the buyer’s ability to complete in a certain time scale. For buyers competing for the same property the ability to complete quickly works in their favour.
Second, an uplift in new build purchases: With the increase in new build purchases clients are expected to exchange contracts in 28 days so time is of the essence.
Third, our digital world: With so much now digitalised, available 24/7 at our fingertips via our smart phones, borrowers assume their mortgage application is transactional and should be turned into an offer quickly. This assumption often sees borrowers setting unrealistic expectations leading to unnecessary pressure.
We endorse lenders working within the regulatory guidelines to ensure we avoid the mistakes of the past by vetting applications properly. To do this properly takes time – so what is the solution?
We are acutely aware of the challenge this presents and the importance of adapting as needed. We see our role as adding value to the process and not just enacting a transaction.
We’ve designed a process using technology as an enabler to keep all parties including solicitors, estate agents, surveyors and clients in the loop, working together, to the same time scales. This transparent and pro-active approach sees very satisfied clients and good working relationships with other professionals who want to work with us and refer business as well.
While we have not seen borrower demand materially change over recent times, people naturally want a quick result and a speedy transaction.
That said, we put pressure on ourselves to constantly improve our customer service and a key part of this is to swiftly process our customers’ mortgage applications.
We practice a ‘Right First Time’ approach, ensuring every application is completed properly from the outset and in a timely fashion.
In our business there’s always been a desire to get a mortgage offer out quickly as it provides relief to the customer, as well as reassurance to everyone involved in the transaction that everything is progressing well in what can be an emotional journey.
The offer, however, is only part of that journey and there is always the potential for challenges in the process that can cause delays such as chains and conveyancing.
In order to mitigate any potential issues, we rely on our industry knowledge and lender relations. It really is a matter of everyone being totally upfront and transparent with timescales.
Yes, the industry as a whole has improved to produce quicker offers due to technological advancements, greater focus and lenders seeing service as a potential for competitive advantage, working hard to speed up their offer process.
However, the most important factor is to have good communication at every stage and especially when initially meeting with the customer to guide them through the process and manage expectations.