Mortgage Tech: Helping you to help your clients

The importance of technology in our in our day-to-day lives in unmeasurable, from turning off our phone alarm clock in the morning, to the end of the day when we may ask Alexa to turn off the lights. Technology allows us to handle some of the smallest tasks to the biggest financial decision many of us make... purchasing property. Technology in the finance sector is becoming imperative. 

According to consultancy firm Capita, 76% of people with a bank account use online banking. The UK has embraced online banking for the more remedial tasks, but can complex mortgage cases be completed online? The rise of digital, and app only banking means that you could make the biggest financial decision of your life through your mobile phone.

The process of buying a property is no different, technology has changed how we search for property, view properties online, bid (and purchase) at online auctions, communicate with brokers, complete mortgage applications, how our affordability is assessed with digital data and finally receiving rejection or approval by email.

In a world which is being taken over by all things social, we as a society are becoming less social in how we interact on a one-to-one basis in the services we need. Less human interaction is not just on the high-street, where we’ve seen streamlining of services and fewer employees on the shop floor. But we’ve also seen challenger banks keeping their overheads low by offering app-based services. Such applications could appeal to millennials and Gen Z’s who may be more accustomed to using apps in their day-to-day lives. These two groups of people made up the largest group of buyers in 2022, with one major building society claiming first-time buyers represented 53% of the market.

The continued need to implement technology in the property finance sector is clear, but process of buying a property is often a personal and emotional experience. The need to retain a service-based industry must not be overlooked, otherwise, the sector becomes a service-based industry with no service. Specialist lenders like West One aim to understand a client's case on a unique basis, thoroughly looking at all requirements, dispensations and other factors which need to be considered during the application process.

What is needed during this process, is better collaboration better between lender, broker and client aided by technology which will enhance the service aspect from lenders. It can help manage the expectations and walk clients through the process to successful completion. The use of technology in these relationships is vital in purchasing property.

A reliance on rule-of-thumb models or BTL stress rates can make lending almost impossible in today’s challenging market. Specialist lenders Like West One utilise technology to streamline business processes, speak with brokers in real-time to log cases and work through to understand challenges clients may have. Without this use of this technology, applications would become slow, clients would lose deals, client information may be difficult to find. Implementing such technology across the West One products allows for two-way communications, digital records of communications, speed, flexibility, and expertise offered, as brokers and underwriters can speak in real-time to fully understand all requirements of an application. The convenience of online portals, access to products, and expertise of underwriters is invaluable at point-of-sale.

The manual underwriting service means that applicant requirements are understood, and soft footprints/soft credit searches can be undertaken, resulting in searches being invisible to other lenders with no long impact on credit record of borrowers. This also helps lenders to assess the success of an application before fully submitting with the information being utilised when compiling an offer, and can result in a deal in principle being agreed in under twenty minutes.

Gone are the days of meeting the high-street bank manager to ask for a mortgage; in many instances technology has replaced the case-by-case applications to make applications fit into a tick box. But specialist lenders who can consider lending outside of their criteria, aligned with a belief in a strong service can be worth their weight in gold. Not just because of individuals who might not fit high-street lender models, but also because of what they are asking might not fit into a box.

In time, decision driven by AI, ‘What if’ models and algorithms will provide faster, accurate results as more and more data becomes available to lenders. But until we reach that future, human intervention and involvement will be key for many people being able to buy their own property.

As high-street lenders move away from singing about providing “extra, extra” to the tune of Tom Jones ‘Sex Bomb’ by a man who famously worked in the service division of a well-known bank, providing service, and going the extra mile should still be key in helping clients. By understanding the market, brokers add value and providing clients with their expertise so that individuals can make one of the biggest decisions in their life in full confidence.

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