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Mortgage tests mean most wait more than two weeks for approval

Potential house buyers are facing a longer wait to get a mortgage after tougher rules and tests were introduced in April.

Latest statistics have revealed that 56 per cent of mortgage offers are now taking longer than two weeks to materialise compared to 44 per cent last year.

The data, from the Mortgage Efficiency Survey, has suggested that the process began slowing before April in anticipation of the Mortgage Market Review (MMR).

Only nine per cent of mortgage approvals are made within five days, compared to 13 per cent last year and 25 per cent in 2012, reports The Telegraph.

The MMR requires borrowers to undergo more rigorous questioning about their spending in interviews that can last up to three hours.

Lenders are responsible for checking that borrowers can afford the loan they are applying for, both now and when interest rates rise.

Henry Woodcock, principal mortgage consultant at financial systems firm IRESS, told The Telegraph: “There’s no doubt that the MMR has taken its toll on the time taken to secure a mortgage.

“More comprehensive affordability testing and lengthier interviews have slowed the application process.

“Added to which, much of this remains a manual process among lenders as they adapt, exacerbating the problem.

“That said, demand for mortgage finance has been so strong in the year so far that lending has continued at a rate of knots despite the disturbance.”

The approval process generally takes between five and 40 days depending on the volume of applications a lender has received, the complexity of individual cases and lenders’ internal processes.

Brokers say buyers should consider the time it takes lenders to process applications, as well as other factors, when choosing a mortgage.

PM Law’s conveyancing team completed on 133 property moves in July. If you need property advice or to get a quotation call us on 0114 249 6926.

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