Once your mortgage application has been submitted, the lender starts the assessment process. You will need to provide various documents and there may be several conversations and requests before you hear whether the application has been accepted. Your broker will be liaising with the underwriter at every stage and keep you updated of developments when they occur.
What impact has Covid-19 had on service levels?
Since the pandemic, there has been a period of time when the entire industry was unable to function as estate agents, builders, and surveyors were all closed. This led to a backlog in workloads and was only amplified when there was a surge of activity after the announcement of the stamp duty holiday. In addition, lenders have had to adapt how they work, with many employees operating from home or some staff being reassigned to customer helplines to support existing borrowers and requests for payment holidays.
All people involved with the application process are busier than normal and with the stamp duty deadline looming, lenders are continuing to receive an unprecedented number of applications.
Service levels vary significantly depending on how complex your application is, what level of borrowing you are looking for, what type of survey is required, and how prepared you are prior to submitting your application.
Historically mortgage offers could be issued within 3-4 weeks, but at present, a mortgage offer is likely to take 4-6 weeks. For those clients who are borrowing 85-90% of the property value or for those who are self-employed, this can easily increase to 6-8 weeks.
Why does it take so long?
Lenders need to complete a full assessment and carry out several checks, verifying a significant amount of information. From obtaining evidence of identification and address, verifying your income, assessing financial commitments and undertaking a credit search, this all takes time. Many lenders have increased the number of mortgage applications being manually underwritten and if you are unable to provide documents at the outset, or supply them in the wrong format, this can cause delays.
Depending on the survey required, how quick the surveyor can arrange access to the property, you may find that the process is slowed even further.
What can be done to speed things up?
- Before you start looking for a property speak to a mortgage broker to gain an understanding of your position.
- Obtain an agreement in principle
- Prepare all the documentation that is needed to support your application
- If you have a complex requirement, your broker should check any specific packaging requirements; these might include self-employed, contractors, gifted deposits, multiple income sources.
- Check the service lenders of each lender being considered. Lenders update these on a regular basis and although products could vary, the time to process may be a factor you consider when discussing the lenders available.
- Look for a solicitor and obtain a quote so you can instruct immediately when found.
- If you are considering selling your property, check with your solicitor whether you can obtain local searches in advance, ready for your buyer.
We’re here to help
We have a team of experienced advisors who can help no matter how complex your requirements are. We would be happy to answer any queries so contact us on 01780 480600.