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Has underwriting become overwriting?

Journalist: Justin Moy, Contributing Editor

ended 19. March 2024

A number of brokers have expressed frustration on Newspage recently about the state of mortgage underwriting, specifically around lenders suddenly asking for huge amounts of evidence for even the most basic applications. We asked brokers if underwriting standards have fallen, and whether lenders are utilising more tick-box assessment processes and fewer experienced staff.

One, Justin Moy of EHF Mortgages,, said: “There has been a drop-off in both the quantity and quality of underwriting over the past few months.” Another, Katy Eatenton of Lifetime Wealth Management, added: “I find the biggest issue is the case checking prior to an application being passed to underwriting, rather than the underwriters themselves. These are generally administrators working to a checklist with less experience, who ask the most bizarre questions. Common sense is definitely not common.”

A third broker, Steven Neale, suggested a solution: “I think a way round this is for underwriters to offer workshops so they can explain their thinking when assessing a mortgage application. We get lots of requests from BDMs offering to meet to explain their products but let’s have more meetings with underwriters. I for one would be happy to sit down with a cup of tea for half an hour to further understand a lender’s underwriting processes.”

The views of 14 brokers are below.

13 responses from the Newspage community

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Katy Eatenton
Mortgage & Protection Specialist at Eatenton Finance
I find the biggest issue is the case checking prior to an application being passed to underwriting, rather than the underwriters themselves. These are generally administrators working to a checklist with less experience, who ask the most bizarre questions. Common sense is definitely not common. The massive differences in process is frustrating too. For example, HSBC and Coventry will call and ask the question, getting the offer out as quickly as possible. Santander will upload a note, that you have four hours to respond to, before it falls back into their standard turnaround times, others will ask for information in dribs and drabs. A bit of consistency across the board would be marvellous.
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Justin Moy
Managing Director at EHF Mortgages
There has been a drop-off in both the quantity and quality of underwriting over the past few months. High Street lenders are questioning the smallest of monthly costs on cases where the payment is insignificant to affordabilty, slowing down the whole application process. Manual underwriting is taking weeks just for initial checks. One lender even questioned who LISA was, and it took 3 attempts to convince the underwriter it is a Lifetime ISA and not a childminder. I wouldn't mind but the LISA statement was provided for assessment, too. These challenges may seem quite superfical, but they add considerable time to the whole mortgage process, increase workloads for brokers, and put at risk many purchases when the chain is waiting for an offer that is taking weeks to be delivered, if at all.
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Steven Neale
Director and Owner at SN Mortgages
I only arrange adverse credit mortgages so expect these underwriters to be particular in wanting to understanding a client’s situation and asking more questions. However, there is always a roll in your stomach when you receive an email or a phone call from the underwriter. What do they want now? How can the client not have the amount requested when it is only 2x their joint income? Why have you declined my client a mortgage because of a status 1 on a credit card in November 2022 (true case). I think a way round this is for underwriters to offer workshops so they can explain their thinking when assessing a mortgage application. We get lots of requests from BDMs offering to meet to explain their products but let’s have more meetings with underwriters. I for one would be happy to sit down with a cup of tea for half an hour to further understand a lender’s underwriting processes.
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Bob Singh
Founder at Chess Mortgages
Underwriters by and large do a great job. Sadly a small jobsworth minority are tick-box merchants who fail to apply common sense and concern themselves with microscopic and trivial issues that have little or no bearing on the case in hand. Of course they have to address AML and affordability issues as well as account conduct but some comebacks are a bit silly. In a recent case, the landlord and tenant both had the surname Singh. Not an uncommon surname and the underwriter wanted to know if they were related. No more related to each other than to me. Case declined despite my detailed explanation on Sikh surname nomenclature. The lack of cultural awareness is shocking. But we soldier on.
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Simon Bridgland
Director at Charwin Private Clients
Some of the largest lenders in the UK have some of the worst underwriting, compounded further when part of it is offshored and so leaves the broker without the ability to discuss the case verbally. In these situations, it’s left to case updates or messages on substandard lender websites. Said updates and request are often written in Elvish riddles leaving you helpless due to an underwriter not being able to explain clearly what they are asking for. I’d say room for improvement from some corners, with Barclays seeming to struggle more than most.
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Michelle Lawson
Director at Lawson Financial
The level of service varies from lender to lender and some questions that get raised are just beyond daft. They have access to supporting documents and credit files to cross reference data. There is often a lack of clarity on a request for further info which involves then a call. I have been asked what a payment to a credit card company was for, why someone has taken 12-month maternity leave, why a credit card has been repaid in full, what specific payments to Paypal were for just to name a few. It appears that some lenders have replaced underwriters with cheaper processing staff with tick boxes. This is not the solution. We need good underwriters with a good common sense approach and lenders with a decent risk team who gives the appropriate message that they want to lend and not be business prevention units. Lenders' service levels are being hit right now and brokers and borrowers are being tested to the limits and this is one of the reasons why.
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Ben Perks
Managing Director at Orchard Financial Advisers
Sometimes it can feel like you're dealing with the Mortgage Prevention Unit. There are lenders that have really tightened up and underwriters are clearly knit-picking. As brokers we have no problem clarifying points or providing additional information to help get cases through, all we expect is a common sense approach and a positive attitude towards lending. There are an increasing number of lenders that do really it well though. The access to underwriters is brilliant and they are a pleasure to deal with. You can tell when an underwriter has been given a good mandate to lend and they are eager to help borrowers. It makes all the difference and those underwriters are worth their weight in gold.
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Anil Mistry
Director and Mortgage Broker at RNR Mortgage Solutions
Gone are the days of common sense in underwriting, especially with lenders that have underwriting overseas and cling to their tick-box tactics. If everything isn't just so, they're back asking for more. At our firm, we combat this with transparency: every non-standard detail, every income calculation, is meticulously explained in our file notes and it is uploaded to their system. We only do this with certain lenders that we think need this extra explanation. This strategy often leads to first-time success. We're not just filling out forms but need to set a new standard for clarity and efficiency, especially with certain lenders.
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Luke Thompson
Director at PAB Wealth Management
There are some real stand-out poor performers in terms of underwriting at the minute, with TSB being a good example of this. A recent case I have submitted to them took weeks to get to offer based on their insistence on getting a workplace reference that is never easy to obtain from big companies even though my customer has worked for his employer for over 5 years. Santander also recently offered a case in a matter of days, only to retract the offer and ask for several more documents from my client all because he is employed by a family business. Absolutely no issue with further checks being required but to issue an offer and then retract in my opinion is the height of poor customer service.
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Gareth Davies
Director at South Coast Mortgage Services
We just need common sense to be applied. The quality of underwriting can vary hugely even within the same lender, from one case to another. Seemingly gone are the days where an underwriter could pick up a phone and ask the broker about a case in order to get an understanding of the overall situation the client is in. What could be resolved in a 30-second phone call, can take well over a week and countless emails to and fro. This doesn't help any party at all. Oh, and if I get asked if 'Moneybox LISA' is a dependent one more time...
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Scott Taylor-Barr
Principal Adviser at Barnsdale Financial Management
I am finding that cases are taking longer and more input from us is needed to get cases to offer. A lot of this seems to be inexperienced staff dealing with cases, meaning that they asking for information they already have, but maybe in a different format, or failing to properly explain what information it is they require, meaning the broker then sends in what they "think" the underwriter has requested, only to wait for it to be assessed and then exactly the same request be made again.
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Hannah Bashford
Director at Model Financial Solutions
When there are lenders that can get an offer out in a few hours, it baffles me some of the questions I get asked about borrowers and their application. The biggest challenge I find alongside common sense is communication. Some underwriters will send an email or online update and when I reply it goes back into a queue. If they had picked up the phone we could have had a 30-second call and they could have closed the case off, but instead it goes back into a queue, wasting time and causing frustration.
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Matthew Jackson
Director at Mint FS
Without doubt we have seen an alarming drop off in the standard of underwriting by the majority of mainstream lenders. This could be fuelled simply by a hardening attitude to risk but conversely it could be an influx of new staff who appear to be painting by numbers with little to no common sense exercised. An example of this from a recent case is an underwriter requiring a written explanation for a £5 standing order that appeared monthly on a bank statement. It was pocket money being sent by the borrower to tjheir 15-year old daughter. Or querying a large transfer to another bank account, which they also have a statement for and houses the client's deposit for the purchase. And perhaps the most common query raised at the moment is year to date pay not matching the stated salary. Pay rises and promotions are not to be expected in the current economic enviroment. Our clients expect better and, as an industry, we can do better than this.