Using a mortgage broker can speed up the property buying process
Tuesday 12 March, 2019
How can we speed up the property buying process so you purchase your home more quickly?
One of the main issues slowing down the mortgage process is about the amount of time it takes for management companies and local authorities to return the leasehold details where applicable and for local searches to be organised. I have been involved in transactions where this has delayed the mortgage process for up to eight weeks which is not acceptable. The good news is that there is talk that this will change soon so this would mean third parties would have to respond in a reasonable time frame and could no longer hold up what is already a painful and stressful transaction.
A mortgage lender’s decision ‘in principle’ does not guarantee you a mortgage
The other main factor that holds up the buying process is the mortgage itself and the process of getting one. The main problem which I often see is that consumers have a decision in principle from a bank or a broker who haven’t yet seen their relevant documents. When you find a property and instruct solicitors and draw up contracts then go back with your documents, you sometimes can no longer borrow that loan amount. This is because a ‘decision in principle’ or an ‘agreement in principle’ is just a credit check and the loan amount that appears on this certificate is based on what has been input.
Halifax allow you to apply for an ‘agreement in principle’
The Halifax allows you to apply for an ‘agreement in principle’ which sometimes causes problems if the client doesn’t know which income, expenditure and other details to include on the application form. This could have a big effect on the loan amount you can borrow. Sometimes this means that when you find a property and go back to the lender you discover you cannot get your proposed property. At this point you have wasted a lot of time and money.
Having mortgage approvals subject to valuations would speed up the mortgage process
The proposal that I have put forward that many agents, solicitors and consumers who I speak to agree with is the requirement for mortgages to be approved subject to a client’s valuation. I recommend mortgage applications should be submitted along with all the relevant documentation so the lender agrees to give the requested loan amount. The client can then go and search for a suitable property. As soon as they find a property the details can be given to the lender, a valuation will be organised and as long as the property is suitable, a mortgage offer is issued. All the work is done up front and agents, solicitors and vendors don’t have to worry about mortgage offers so the time frames will reduce.
I would like to find out what people involved in a property transaction think about this idea. However, if it is implemented I know the lenders will face increased costs with this approach, but a simple solution would be to impose the cost on the client. For example charge a £100 booking fee when an application is submitted which gets refunded if you complete on the mortgage or find a property. This will help stop the delays, time wasting and non-serious buyers.
Get mortgage advice from a mortgage broker so you know how much you can borrow
When the Thomas Oliver mortgage broking team provide mortgage advice we always ask to see your mortgage documentation including credit reports. This allows us to give you an accurate mortgage amount and budget which means you shouldn’t have to go through the painful process of losing out on a property because of finance.
Our mortgage brokers can review your financial circumstances so we recommend the most suitable mortgage product for your situation. We are used to working with a variety of clients including first time buyer, home movers, anyone re-mortgaging or investors purchasing a buy-to-let investment. If you would like more information about the mortgage process and want a free initial mortgage consultation please contact a member of the Thomas Oliver mortgage broking team on 01707 872000.