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When will the mortgage industry be fully digital?

Journalist: Emma Simon, Mortgage Strategy

ended 30. April 2024

I am lookng for comments for a news analysis piece for Mortgage Strategy. It needs to be written ASAP so comments by end of play 30 April would be gratefully received. 

The piece is looking at the switch from paper based applications to digital services - and whether this has happened quickly enough in the mortgage industry. The main questions I'm addressing are: 

  1. Has the mortgage industry been too slow to fully digitise, and is the mortgage application / house buying process still reliant on paper-based legal documents and contracts?
  2. If so, is this slowing down the house buying process ? Where are the particular stumbing blocks - is it conveyancing/ valuations / certain lenders mortgage applications, or all three! Have targets to be ‘paper free’ been missed? 
  3. What  can be done to move towards a more streamlined electornic process? Is this something individual lenders can address or will it need industry-wide action or regulatory change? 
  4. As well as speeding up the process what are the other potential process? If this is done correctly could this be more secure/ less subject to fraud. Is it also important that this is a greener option (helping lenders net zero targerts?) 
  5. Are there any potential drawbacks of an electronic only house buying process?

Many thanks

Emma Simon 

 

6 responses from the Newspage community

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Michelle Lawson
Director at Lawson Financial
I think this is very much on the cards but there are so many turning cogs in the property industry that it is hard to fully digitalise unless everybody uses the same platforms and also policy is also largely driven by the interpretation of guidelines by Operational Risk teams. I have been in the industry over 20yrs and the process has significantly slowed rather than accelerated which is ironic considering the vast technology now available. If the whole process was digitalised we would see transaction times dramatically reduce but this isn't a job that can be undertaken quickly.
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Dariusz Karpowicz
Director at Albion Financial Advice
While we strive to minimize paper use, handling all client interactions and document storage online, the UK mortgage sector lags in innovation. Much inefficiency remains, with redundant data entry across disparate systems. Despite varying levels of digital adoption among lenders, the industry-wide shift to a fully automated, electronic process is slow. Current systems are not well integrated, making true automation difficult without a unified approach, possibly needing regulatory changes. While a fully digital process promises speed and reduced fraud, it could also mean a seismic shift in the role of advisers. This evolution, while inevitable, brings mixed feelings about the future of personal advisory roles in the industry.
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Stephen Perkins
Managing Director at Yellow Brick Mortgages
Our brokerage like many operate almost entirely paper-less. The clients do not need to print or sign any paperwork for the mortgage side of things aside from a couple of lenders who have paper based declarations. Even conveyancers are mostly working electronically now, but due to land registry requirements the contracts, stamp duty returns and mortgage deeds often still need to be wet signatures. There are however across all instrustries some firms that refuse to move away from archaic paper-based systems.
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James Mason
Owner at Hawksman Real Estate
When a Buyer tells you that they are using a certain mortgage lender, my heart just sinks. Slow antiquated systems that delay the process by not just weeks but months..
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Aatif Fazal
CEO at Frida Finance
1. Well as myself just nearly being part of the new generation I feel like the mortgage industry has been way to slow to digitise especially with how rapidly technology is advancing by the day. People in this day and age want stuff done as quick and efficient as possible. There’s no room for delays.


2. Conveyancing, valuations etc, you name it and there is still no change. Even though getting a mortgage offer has had its waiting times reduced significantly to getting a offer from a lender in little as 5 working days, the process that follows it on can seem pretty daunting and long. For example just the conveyancing on its own can take up anywhere up to 6 months to complete.

3. There is so much that can be done to move towards a more streamlined electronic process to speed up times across the board. For example ID verification can be so much easier by just sending a link to the client in which they can take a selfie and take pictures of there documents to upload in the comfort.
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Scott Taylor-Barr
Principal Adviser at Barnsdale Financial Management
The digitalisation of elements of the mortgage market and house buying process is great; it allows standardisation, speeds up the end-to-end journey and reduces anxiety and stress for all parties. However, to play the devil's advocate for a moment, it also has its issues; the primary one being a lack of flexibility. They are designed for a "typical" or "average" customer - but what if the applicant is not typical, or not average? Digital systems are binary, black and white, you are something or you are not. What about the grey in between? Many brokers will be able to tell you all the times that a case didn't quite meet the rules of a lender, but because of X, Y, or Z the underwriter was able to use their discretion and agree the mortgage - saving the client the cost of taking a more expensive option, or at worst, allowing them to proceed as they were the only lender willing to consider the case. It would be disastrous to lose that ability in the race towards a digital process.