Brokers debate whether speedy mortgage offers are good for the industry
If broker Dharminder Singh had ordered something as simple as a takeaway coffee, he couldn’t have expected faster service than he received in response to a recent mortgage application. The director of Mr Singh Financial couldn’t hide his delight when he received approval from the lender in just three minutes.
“I normally don't do this but just wanted to shout out about Barclays,” Singh enthused. “Submitted a mortgage application at 17:27 today, and got a mortgage offer at 17:30! Just brilliant, well done Barclays UK. Another happy customer.”
As someone who’s been in the mortgage business for over 13 years, Singh is clearly used to application decisions taking longer, and it’s hard to imagine an approval being much faster, but it does, apparently, happen…
“I think over the years, as technology improves, lenders have improved their way to verify documents and whenever they can verify clients pay on the backend, without any documents, then nothing is holding them back from issuing a mortgage offer. But I always make sure I go through all the documents before submit any application, so that whole process for client can be less stressful.”
“My quickest offer was actually issued by Atom in just 13 seconds, which was mind blowing at the time,” said broker Hannie Mason (pictured left), director of Mortgages with Hannie.
But is mortgage approval speed everything, and is a very quick decision always a good thing, particularly if it detracts from a broker’s hard work? “While we do love a quick turnaround, I don’t think these speedy offers mean anything is being missed or they haven't thoroughly assessed something,” Mason reasoned. “It’s just more automated now. Lenders have robust controls in place to ensure everything is thoroughly verified before an offer is issued. That said, I don’t think speed should be the only measure of success. A super-fast offer is great in terms of efficiency, especially for clients on tight deadlines, but there’s definitely such a thing as too fast when it starts to give the impression that getting a mortgage is as simple as clicking a button.”
Mason is concerned that if things move that quickly, it could unintentionally downplay the role of the broker. “Clients might think we haven’t had to do much, when, in reality, there's a lot of work behind the scenes to get an application to that point, from gathering documents to advising on the right lender and navigating criteria,” she said. “Speed is fantastic, but not if it comes at the cost of undervaluing the advice, care, and detail that goes into the process. Ultimately, it’s about balance. A fast offer is brilliant, but only when it’s combined with accuracy, clear communication, and a smooth process from offer through to completion.”
Thomas Boughton (pictured second from left), founder of Artillium Finance Partners is impressed with the automated processes which Barclays is using to speed up decisions, but agrees it risks cutting across the value of what a broker brings to a case. “We've had many recently where you submit, make a cup of tea and come back to a full mortgage offer - lovely,” Boughton said. “I think it does bring into question what a mortgage brokerage will look like once AI becomes more prevalent in the next few years, and how we will need to adapt our businesses so not to be left behind. It's coming and there is nothing we can do but adjust our businesses to accommodate for it.
“An issue we have is then trying to justify our fees to our clients as in some cases we might speak with them on a Monday, decision in principle on a Tuesday and submit a full application on a Wednesday. If the mortgage goes immediately to offer, we are, of course, obliged to notify the client in the first instance but this can cause some questions, when sending out the invoice, as our job seems of little value due to the speed and ease of receiving a successful mortgage offer.”
He continued: “Another issue I have found, notably with Barclays, is if you need to amend the case for any reason, post-offer, there is a decent chance that the case will be rescored and be put in front of an underwriter for full, normal underwriting. This can cause stress and confusion to the client as they can be asked to send more documentation despite already receiving the offer before.”
Mortgage adviser Eric Miller (pictured second from right), from Affinity Group, suggests that with the wealth of information available these days with credit profiles and open banking, it's a surprise that some offers take so long. “A speedy process is great when the result is positive but when automated systems generate a decline that's where lenders need to get better at reviewing cases,” Miller said. “I have seen a number of almost instant offers, which have been great but not if the solicitors are then left to ask questions which can delay the case. It would be much easier for the lender to deal with these upfront.”
He continued: “On the downside, I have seen automated valuations cause a case to decline and the lender refuse to instruct a physical inspection. I have seen a case fail affordability following the computer analysis of the client's bank statements, with one month of increased spending significant the maximum loan. There is so much more that lenders need to do to speed up the process. Wet signatures on documents like the initial applications forms are time consuming and do nothing for the environment. Payment links for applications or valuation fees should be sent directly to the client instead of asking a third party to handle the details. There are changes coming as AI is integrated into the process. The human element will be essential still but those processes still need to be streamlined.”
Read more: Mortgage brokers give their verdict on 100% LTV, no deposit offer
How important is speed?
Ben Perks (pictured right), managing director of Orchard Financial Advisers, believes that as the UK property market gathers pace, speed is king. “Lenders with a slick mortgage process will win favour with brokers and borrowers alike,” Perks said. “It’s definitely horses for courses though and we operate in an industry that needs both fast and slow paced underwriting. I’ve had two cases this week with HSBC go from application to offer in just a few days and it is a refreshing change. When packaged correctly by a broker, ‘clean’ cases should fly through - the quicker the better, nobody has an issue when a ‘computer says yes’ approach is applied. It’s the negative outcomes that require more time. I’d be pretty annoyed if I’d placed a case and it got declined in a nano-second, there is a need for review and sense checking.”
He added: “More complex cases demand that time is taken and an old-fashioned personal touch approach used. You need the confidence that a person has had sight of the case and applied real life experience, knowledge and common sense. This is where the mortgage Industry need to use AI to compliment it’s processes and not replace them.”
Kasia Makarewicz (pictured inset above), senior mortgage and protection adviser at Step by Step Financial Solutions, meanwhile commented: “It's always great to have a quick response from a lender - it gives clients confidence that the process is moving in the right direction. My fastest response so far was with Barclays - just 12 seconds from submission to offer, which is remarkable. That kind of turnaround can be extremely useful in certain situations, especially for straightforward cases. That said, speed alone isn't everything. What really matters is clarity and communication between the lender and the broker. A lightning-fast offer is only truly valuable if it’s based on a solid understanding of what's required and if the offer is sustainable through to completion.”
She continued: “We’ve definitely seen lenders investing heavily in technology - income verification systems, real-time credit data access and more accurate automated valuations are helping streamline the process significantly. This investment is paying off in terms of efficiency and consistency, which is great for all parties involved. However, it’s important to remember that buyers are usually already in conversations with their broker for days or even weeks before the application is formally submitted. By the time the application hits the lender’s system, a good broker has already done a deep dive into the case, especially if the purchase is complex. That includes reviewing documentation, anticipating potential issues and clarifying all unique aspects of the case.”
Makarewicz added: “In those situations, a quick offer, or at the very least, a clear and prompt indication of what’s needed, is really just the cherry on the cake. The real value lies in getting the foundation right, because as brokers, the worst scenario is when something critical is missed early on and an offer is pulled at the final hurdle. That’s why speed is great, but only when paired with thoroughness, transparency, and good communication.”
For Ben Groves (pictured inset above), managing director and founder of Yomo Finance, speed is important, for the sake of his customers. “We have clients that have had an offer accepted and the anxiety of knowing whether their new mortgage is going to be approved or not is not to be underestimated,” Groves said. “Why should it take a lender two weeks to approve a fully submitted, fully compliant case? I believe more automation is needed with some of the lenders verifying payslips, bank statements, property valuations automatically. Other countries around the world have a much faster and slicker process for mortgage and conveyancing, why shouldn’t we?” He added: “I have had instant approvals and it really does make a difference to the client journey. It allows them to keep recommending our services, as our job is to get a mortgage approved. If that takes two minutes rather than two weeks that’s what we should, as an industry, be aiming for.”
Steve Humphrey (pictured inset above), director of The Mortgage Pod cautions that speed isn’t always a good thing. “For a lender to automatically assess and approve an application in three minutes, it means there has been no real assessment of the property,” he observed. “This is particularly important on a purchase application as the client will likely now need to spend money for a physical inspection of the property, such as a level two survey".
