A typical 50-day wait for a buyer to receive a mortgage offer “increases the risk that sales will collapse and puts unnecessary pressure on all transactions within a chain” according the the National Association of Estate Agents.
The delay, revealed in an NAEA statement to the House of Lords, is as a result of the 2014 Mortgage Market Review, after which two thirds of the association’s agents reported a decrease in the number of buyers.
“This was the direct result of a slow-down in acceptance of mortgages, with it now taking an average of 50 days to receive a mortgage offer. This increases the risk that sales will collapse and puts unnecessary pressure on all transactions within a chain” says the statement.
The NAEA was making its statement in the consultation period of the House of Lords Select Committee's inquiry into the state of the UK housing market.
The association’s comments, made jointly with the Association of Residential Letting Agents, called on the government to adopt a longer term approach to housing policy and consider the full cycle, from making sure the country has enough skilled professionals to build additional housing, to giving more financial support to first-time buyers.
“Whilst we welcome the initiatives already announced this year such as Help to Buy ISAs and Right to Buy for housing association tenants, which will be replaced on a one-for-one basis, people are going to need even more support in accessing finance to purchase property once they are built” says the association.
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Other loans (Cars for example) are given instantly, why is it the Mortgage Industry are so slow - and worse REFUSE to communicate anything to anyone? (about a loan progress) - their catch-all of ''its being processed'' is NOT acceptable.
We need new entrants with a sharp customer focus coming into the market. Mortgage offers (subject to title etc.,) shoudl be made in 7 days - or 14 max in this day and age.
Get with it ''Mortgage Industry'' - you people need shaking to your complacent core.
Problem being, before the financial crisis mortgages were notoriously easy to get - they were literally handed out to any old Tom, Dick and Harry. That didn't go too well.
I agree that the process is too slow and long-winded, but I also think the right regulation needs to be put in place so we don't return to the days of 100% mortgages and cleaners laying down a deposit on a 3-bed in Mayfair.
Mortgages should be processed as quickly as possible, but not at the cost of proper checks.
Totally agree that precautions need to be taken, but the situation as it currently stands is ridiculous. So many sales are being put at risk because of unnecessary delays. It's not good enough.
There can be a phenomena called ''Over regulation''
Everyone (almost) accepts there has to be due dilligence (that can be done in 7 days!) but when mortgage lenders essentially have to ask ''do you use Butter or Margarine?'' to assess affordability (My parlance! but it amounts to the same thing) then regulation has gone too far.
There is a long way from this overregulation to the cleaner getting her Mayfair property.
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