Issues with property titles and borrower affordability have been revealed among the main reasons why mortgage offers have been withdrawn.
The results form part of The Conveyancing Association’s 2022 lender survey, used to identify where the industry can collaborate to improve the mortgage and conveyancing process and ultimately improve the homebuying and selling process.
While 50% of conveyancers said they had rarely acted for a client who had a mortgage offer withdrawn or amended, 27% said this had happened ‘sometimes’ and 8% ‘usually’.
Reasons given for why a mortgage offer might have been withdrawn included almost 50% who said it was to do with issues with the property title while 27% highlighted issues around the borrower not meeting affordability requirements.
Another 12% blamed issues in the lease.
More than 80% of respondents said they had ‘usually’ or ‘sometimes’ had to raise a post-offer query with a lender.
When asked what one thing would speed up the post-mortgage offer process, 48% of conveyancers said better communication via the lender portals, 36% said securing a better response time to queries, 11% said greater consistency within UK Finance’s Lender Handbook Part 2, and 5% said the introduction of a standard post-offer referral form.
There was overwhelming positivity about the greater use of Qualified Electronic Signatures (QES) within the process
Close to 80% of respondents said they felt having the ability to sign dispositions such as mortgage deeds and transfers using a QES accepted by HM Land Registry would improve the customer journey.
Beth Rudolf, director of delivery at The Conveyancing Association, said new upfront information rules for agents would help stamp out some of the post-offer issues.
She said: “Our Lender Survey is always a useful exercise in its ability to determine the current bottlenecks that we hope can be overcome with a sharing of this information and greater collaboration to improve the home moving and mortgage process.
“Clearly, we have already started to engage with the lender community on potential areas for improvement.
“Post-offer queries are a major drain on all stakeholders within the process and it’s obvious from the survey results that a large number of these can be sidestepped with the greater use of upfront information at the point of marketing.
“This is already on its way thanks to the National Trading Standards Estate and Letting Agent Team project to deliver material information. By having the correct details about a property at instruction, stakeholders can reduce their liability and the resources needed in dealing with the case which will improve the home moving process for all, especially the consumer.
"The most common reason for a mortgage offer being withdrawn is because of Title issues, and again if this was known at the outset, then it would be possible to mitigate against such an outcome.
“We all want to see an efficient, more certain, conveyancing process in action. One that does not take the best part of five to six months, and in terms of the post-mortgage offer process, conveyancers feel better communication and quicker query response times will help significantly.
“Greater use of technological solutions and digital options will make a huge difference to the consumer, the conveyancer and HM Land Registry. It’s therefore positive to see the enthusiasm for QES usage amongst conveyancers from the results, and we are aware 21 law firms are currently signed up to a QES pilot with HM Land Registry, utilising three signature platforms. We look forward to seeing the results of that pilot which hopefully set the foundations for greater QES usage right across the piece.”