Electronic trading has flourished over the last three years and is integral to the way intermediaries now do business. An important initiative is the creation of trading hubs which allow mortgage brokers access to multiple lenders at once, thereby saving time and money.
One of the biggest of these platforms is the Mortgage Trading Exchange, jointly owned by Nationwide, Alliance & Leicester, HBOS, Northern Rock, Royal Bank of Scotland and Woolwich/ Barclays.
The MTE is supported by over 50 lenders which have committed to accept electronically submitted mortgage applications and agreements in principle through the platform.
The MTE's reach was extended even further when Cheltenham & Gloucester, Coventry Building Society and Accord Mortgages signed up. This platform is now supported by organisations that have 80 per cent of the mortgage market.
A single password will allow you access to many lenders, providing a fast and secure way of submitting applications. In many instances, lenders aim to have responses with you in less than a minute. Instant feedback means that you can secure a decision for your client while they are still with you.
Electronic trading platforms are better for lenders, better for consumers and better for brokers. For example, the consistency that is offered by accessing over 50 lenders through just one portal means that you do not have to learn how to use a number of different lenders' websites with their differing styles and content.
In addition, individual websites require you to remember many different user IDs and passwords which can change without notice and lead to frustrating delays.
The MTE is not only a platform to send decisions in principle or mortgage applications but it can help with a broker's compliance requirements once the new mortgage regulations come into effect. The FSA will require lenders and brokers to supply key facts illustrations to borrowers to improve clarity. This will enable better comparisons between products as information is presented in the same way by each provider.
However, while this transparency will enable borrowers to directly compare and contrast different mortgage deals so they can make more informed choices, the ultimate responsibility for the accuracy of the key facts illustration as a whole is on the broker.
This is where the MTE can help. If you choose to use it to obtain a key facts illustration from a lender's system, it will ensure that the facts you must provide to all your customers prior to applying for a regulated product are not only accurate but exactly the same as those provided by the lender at the offer stage.
For many people, mortgage regulation means more information, documentation and duplication of effort. If an intermediary has a mortgage sourcing system which is fully integrated to the MTE, it can remove significant duplication of data or effort. The MTE can automatically search for the relevant data about a mortgage, such as rates and fees.
It can transfer this information directly to a key facts illustration request form and also to a decision in principle or mortgage application. In addition, the MTE is flexible, allowing offline data capture with online submission, saving you money as you do not have to be online until you are ready to submit an application.
I believe trading platforms can give intermediaries the best of both worlds. You can avoid the need to visit individual websites while still having a simpler, more efficient and effective way to do business with lenders electronically.
Using one platform means you can do business in one place, saving you time and money as you only have to key in customer details once and this information can easily be transferred from one lender to another.
Looking to the future, we hope electronic trading will work alongside other electronic solutions to make the housebuying business more streamlined. Conveyancing is an area which is undergoing significant change as the traditionally paper-driven process moves online.
In 1999, Nationwide and Her Majesty's Land Registry piloted a system of dematerialisation which meant that title deeds were available electronically directly from the Land Registry. In addition, solicitors can now request redemption statements from us online, which are then automatically sent by fax, saving time and money. This is another step towards a truly electronic conveyancing system.
E-trading is good for all our businesses as it is quicker, accurate and more efficient, allowing us all to be more effective for the good of the customer. As more and more lenders come on board, the industry is moving further towards an electronic marketplace with faster service and increased choice. This will help convert customer enquiries into sales, which will improve everybody's bottom line.
Peter Leydon is head of intermediary markets at Nationwide Building Society