Should it be easier to apply for a mortgage?
It is fair to say arranging a mortgage is a challenging process. Obtaining a mortgage and buying a home is the most significant commitment a person will make in their life. Lenders need enough information to ensure they make an informed decision about the applicant, and their ability to pay off the loan. Therefore, arranging a mortgage will always require an applicant to provide sufficient information about themselves.
Of course, many people argue the process of applying for a mortgage should be easier than it is. The lender will always have to carry out checks and tests on the applicant, but if the application process can be made more straightforward, it is likely applicants will feel more comfortable about applying for a mortgage.
Technological advances can assist companies vetting applications
The financial services market has already utilised technological advances to provide clients and customers with an improved standard of service. It is possible to speed up an application process without compromising on the standard of vetting which is being carried out.
By speeding up the vetting process without compromising on the application process, a lot of the stress and inconvenience should be removed. This is an outcome which is likely to be welcomed by applicants. Also, if the application process is improved, and more information on the applicant is obtained, it should be easier to pair the applicant with the most suitable mortgage for their needs.
The mortgage sector has evolved considerably in the past decade. Up to 2012, most mortgages were arranged with a building society or bank. In more recent times, it is believed around 60% of mortgages are arranged through a broker. The development of the internet and online applications is clear in the mortgage market, and there has been a significant reduction in human interaction.
You no longer need to speak to someone to arrange a mortgage
It is possible for some applicants to arrange a mortgage without speaking to anyone. If an applicant has concerns about the mortgage process or their application, they can speak to a professional, but this isn’t necessary. Improved technology and an increasing use of automated systems ensures applicants receive the support they need, without human interaction.
It is also worth noting HM Land Registry have improved their systems, and are far more digital than ever before. The digital mortgage process has improved the home buying process. When aligned with digital banking, there has been a significant reduction in paperwork. These are aspects which speed up the application process, enabling relevant parties to access important data, allowing them to make an informed decision regarding a mortgage application.
Mortgage lenders need to thoroughly vet tenants. There must be a robust procedure in place to ensure applicants are provided with the right mortgage. However, these tests can be carried out digitally, which hopefully means more efficiently. In return, this should make the vetting process faster, and more dependable.
Some industry professionals expect the mortgage application process to become similar to the process of arranging a car loan. This is a quick procedure, often carried out over the phone or online. The applicant receives an answer to their request in a short time-frame. As long as these decisions are informed and justified, speeding up the process will be of benefit in the mortgage industry.