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In the pipeline

For the first time, the Council of Mortgage Lenders has published data on the average length of time taken to process mortgage applications, from submission to completion.

Brokers want the trade body to go further and name and shame lenders with the most inefficient processes.

The CML’s mortgage survey covers around 70 per cent of regulated lending and is based on data available around six weeks after mortgage completion. A new applications database allows members to include information from the date when customers submit their applications. 

The data is divided into categories showing average processing times for first-time buyers, remortgagers, Right to Buy purchasers and borrowers with high-LTV mortgages. 

Based on figures for the year to June 2013, the new database shows that first-time buyer applications took an average of 81 days to reach completion while remortgage deals took 59 days.

Borrowers purchasing a property through the Right to Buy scheme faced the longest application process with an average of 121 days.

The CML says this publication of data enables lenders to benchmark their processes against an industry average. But it has resisted calls from brokers to publish the data on
a regular basis. A spokesman says: “The pipeline dataset is very much a one-off publication and there are currently no plans to make public any further information on this.

“It has been produced to highlight the differences in application times across various categories of buyer as an interest piece. We may at some point publish another report based on specific market developments but as it stands now, we do not have any plans to publish an updated pipeline dataset.”

But brokers say there is scope for  the CML to make the data more useful, particularly by narrowing the focus to time to mortgage offer rather than time to completion. 

John Charcol senior technical manager Ray Boulger says: “It is key to remember that after an offer is made, the process is then placed in the hands of the solicitors and surveyors and all the other parties that are involved in a property purchase.

“This [data] may be interesting at a glance but we have to bear in mind that the involvement of other parties beyond the lenders does in some way dilute the information presented here.”

Chadney Bulgin mortgage partner Jonathan Clark says that given the property market surge, particularly in London and the South-east, good brokers will need to consider lenders’ current processing times before making a recommendation.

He says: “Lenders only have a finite resource for processing and quicker applications mean more lending. The post-offer issues with estate agents, solicitors and, in particular, sales chains will have a big influence on the overall timescales.”

Clark says the CML’s data is useful as a reference point for brokers but would be significantly more so if lender-specific data was included.

He says: “This data is useful to us as advisers but what we are most interested in is the application-to-offer timescales and how these vary between lenders. 

“Many lenders already share this data with us as, unsurprisingly, they are keen for cases to go through as quickly as possible with the minimum of human intervention.”  

Your Mortgage Decisions director Dominik Lipnicki says: “The same scrutiny that brokers are under should be applied to lenders and a big part of that should be processing times and customer service.

“All too often, lenders release a good rate but do not have the support structure to manage the subsequent influx of applications and therefore suffer delays. 

“A name and shame attitude would bring lenders into the spotlight in terms of how efficiently they are processing applications.”

Boulger wants the data to be revisited to track improvements or deteriorations in processing times. He says: “I would like to see a regular update of this data, just as the CML does with gross mortgage lending data. 

“It would be beneficial to see lender-specific data as well.

“Each lender carries its own internal figures but to see these included in the pipeline database would make it a far more useful reference point for brokers.”


Dominik Lipnicki

The CML says this data could be used as a benchmark for lenders to measure their performance against an industry average. 

I am not entirely sure if that would be the case if the data is to remain anonymous. 

Do the lenders, especially the larger institutions, even care? If a major lender is spending millions on brand awareness and is found to be one of the more inefficient lenders, is it really going to be a top priority to highlight that fact when it can hide behind a wall of anonymity?  

The report is certainly interesting but the extent of its usefulness is limited. 

The time it takes to obtain a mortgage can sometimes make the difference between a borrower getting the house they want, paying a higher rate or not getting the house at all. 

I do not see how it can be fair for a broker to shoulder that blame if it is the fault of an inefficient lender.

If the lender is at fault, let’s make it public.

Dominik Lipnicki is director of Your Mortgage Decisions


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