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Mortgage applications

Journalist: Anna Sagar, Mortgage Solutions / Specialist Lending Solutions

ended 04. October 2022

Looking to speak to mortgage brokers about customers calling about previous mortgage applications they submitted. 

  1. Are customers calling to ask about options for cancelling applications submitted last week when rates were higher?
  2. What are there options?
  3. What would your advice be? 
  4. Do you think pricing has peaked yet? 

4 responses from the Newspage community

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Mike Staton
Director at Staton Mortgages
Are customers calling to ask about options for cancelling applications submitted last week when rates were higher? No What are there options? If a client was to call me and ask me to withdraw the application, I would be making them aware that it is not just interest rates that change, lenders also tweak their credit scoring and criteria so just because your decision in principal was accepted a week ago, it doesn’t guarantee you will be accepted again. After all, a footprint has been left on your credit file. What would your advice be? My advice to any applicant is beware, the mortgage market is volatile at the moment and change is happening daily. If you have an application already in progress, is it really worth losing it? Do you think pricing has peaked yet? Having talked with several business development managers from different lenders, I still feel we are yet to hit the peak. I think we will peak in December and I can see us returning to some sort of stability in 12-18 months' time.
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Imran Hussain
Director at Harmony Financial Services
Are customers calling to ask about options for cancelling applications submitted last week when rates were higher? None whatsoever as rates are still as high or higher right now, and any changes will take a while to happen in lender pricing once swap rates settle down. What are their options? The great thing is many lenders, if they do reprice products, will typically allow a product change to take place prior to completion. What would your advice be? Speak to your adviser is the best advice for everyone right now. Do you think pricing has peaked yet? No, pricing is likely to increase over the next quarter and level off at a level where most 2 and 5 year fixes are around 5%+.
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Robert Payne
Director at Langley House Mortgages
Rates have not dropped since last week but it is a good idea to keep a close eye on the market at the moment, to see how it develops and if there is any opportunity to benefit from better options. Most products do not have any upfront fees so you are free to switch to a new application without any monetary loss if a more attractive alternative becomes available. Getting an application submitted should be the priority, though, as it is unclear what will happen from here and there is still a good chance we will see further rate rises to combat inflation.
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Anil Mistry
Director and Mortgage Broker at RNR Mortgage Solutions
My advice to clients will depend on the transaction they are doing. If the borrower is not moving lenders and doing a product transfer, where the new rate will start many months ahead, then we can see if there are lower rates available closer to the start date. If so, the recommended product transfer can be cancelled before it comes into force, and a new lower rate can be recommended. For a new lending application, this needs to be considered with a pinch of salt. If the borrower has an offer with a high rate, but lower rates are available down the line, then as long as the new lending application does not need to complete soon, it may be possible to apply again. This is so that a lower rate can be obtained. Factors such as the time it will take, and any change in the client's circumstances, will need to be considered to see if this is plausible.