Mortgage lender service levels

Lenders at the sharp end of the market, the ones with the lowest rates, are still continuing to see volumes of business they are simply not designed to cope with. Many have been increasing interest rates to make themselves less attractive and slow down the in-flow of applications, but this often simply causes a domino effect in the market as each lender that becomes "cheapest" does the same to manage their workload, so the original lender ends up back oat the top of the tree and so the process starts again. Providers are right to try and manage the work they are doing, some lenders have waiting times of 15 days to look at a bit of post, which no one wants. The problem this causes for brokers is in managing client expectations. Mortgage applications are going to take weeks, not days, in many scenario's. The mortgage deal you were quoted on Monday, may not be available on Tuesday. Even once the mortgage offer is issued, it doesn't get better, with many conveyancing firms also struggling with the volume of work and so the whole legal side of the transaction is also taking longer than many clients will be used to. In terms of what can be done? That's really difficult to do as essentially we need the number of mortgage /property transactions to reduce and allow everyone to get back onto an even keel. Or, we need to know that this is the volume the market is to expect long-term, so that participants can invest in the resources to cope.

Service levels for many lenders are incredibly slow right now. A few seem to have been caught out by the level of demand for their products. I'm advising clients to not expect any feedback from the lender for the first couple of weeks at least and to expect an offer to take 6 weeks. So many of the enquiries we make with lenders are either for unclear criteria, poorly worded documentation and application forms (often with no tooltips to clarify what they're looking for), or a lack of communication. It's incredibly frustrating and wastes everyone's time. If lenders just took a bit of time to address these issues, and view their process through a broker's eyes, I'm sure they could cut their support workload in half

Nearly all of the major players have struggled with the unprecedented levels of demand and one point or another. Lenders have been frantically re-pricing themselves out of pole position to protect their back office as daily lending amounts of over a billion have become common for many of them. My advice would be to discuss your priorities and be aware of whether you need a quick turnaround or not, after all paying slightly more per month is better than losing out on the property you've got your heart set on. The market will start to settle down now that the initial rate rises have happened and service levels will start to return to normality. You cant blame the lenders when they are receiving two weeks worth of business in one day and one reporting to have received 14,000 applications in one evening!

Service is a real Jekyll and Hyde scenario. Some lenders have reach services levels reaching 3 weeks plus before they can review an application then there are a handful that can still check an application same day or within a couple of days. Our advice isn’t always necessarily about chasing the cheapest rate. We also need to factor in other aspects about what’s important to a client such as service. For many first time buyers, buying a house is the most nerve racking experience they’ve been through. When you really get to know your clients and understand their situation some are willing to forgo the cheaper deal if it means they find out their mortgage gets agreed sooner. Common sense needs to be applied, for simple questions that could be answer in a 5 minute call underwriters should be picking up the phone to speak to us brokers. Instead they hide behind an email and then any response goes back into a que. Also we can’t keep blaming covid as an excuse for poor service. We aren’t talking about small businesses here, we’re talking large organisation which should be recruiting based on the demand the industry is experiencing.

1. What are mortgage lender service levels like currently and who are the worst offenders? Service levels are currently the longest I have ever seen them. Worst offenders are not those with longer service levels but those who constantly cannot keep within their service levels but keep quoting them ( I had one Highstreet lender who told me it would be a 4 working day turnaround for it then to be 15 working days, whilst the whole time showing 4 working days on their website) 2. What is the advice you give to clients now and how is it different to six months to a year ago? Has it changed based on service levels? The advice I give now is to start conveyancing when the DIP has been accepted as at least that way some time is saved as the solicitors can get on with their side of the work whilst the lender does their underwriting. I also used to advise a remortgage would take 6-8 weeks however I know advise this is likely to be 9-12 weeks 3. How can service levels be improved or what can be done to mitigate them? I think minimum submission requirements is a very good idea which I know a lot of lenders have brought in. This means that at the point of application you have to upload a set amount of documents (eg passport, bank statements, payslips etc) I think this saves a lot of the underwriters valuable time in chasing for these documents to progress the case.

Terrible, to put it simply, its never been more important to utilise a broker to ensure that your case is properly packaged, things are very slow but to then have something missing in the file and you end up at the back of the que again to be re visited. Some lenders are still on the ball, we are still getting the occasional lender offering within a week, but lenders need to use some common sense, close to new applications for a few days, allow your staff to catch up, emails from underwriters at 10pm are now not uncommon, I really do feel for them