The survey was carried out by mortgage best practice site TCFinfo.co.uk, Mortgage Brain and the lender consultancy BEP Financial Systems and was completed by 251 brokers and IFAs.
Comments from advisers included “lenders are taking forever to look at cases”, many spoke of big delays with no flexibility and some said that lenders’ staff were unfamiliar with the new procedures and were no longer underwriting, just following procedures.
78% of respondents also said that lenders’ affordability rules differ either slightly or significantly. One said that “affordability seems to be a haphazard practice with different lenders having completely different rules”.
Unsurprisingly 66% of advisers said that it now took them over an hour to conduct an initial mortgage interview, double the 33% who said that it took over an hour before the MMR, with some saying that it now took three hours to conduct the initial mortgage interview.
Worryingly, and reflected in recent Bank of England figures, 85% of advisers said that the MMR rules have had an impact on their ability to write new business with 25% saying that they have had a substantial impact. The advisers also did not feel that lenders kept them adequately informed, with 57% saying that lenders did not provide them with enough information on regulation and best practice and that instead they turned to their network or mortgage club for this information, to the trade press or directly to the FCA.
The survey, which is carried out on a quarterly basis also gave an insight into the makeup of the adviser market, and revealed that 55% of respondents are now over 46 years old with a further 5% aged over 65. Only 39% of advisers were 45 years old or younger, showing a worrying lack of new talent coming into the mortgage industry.
The survey represented the whole adviser market with 27% of respondents being IFAs; 29% directly authorised mortgage brokers and 36% were appointed representatives.
Chris Little, managing director of BEP Financial Systems had this to say:
“The survey which was answered by hundreds of mortgage advisers and IFAs revealed that life has got much harder for them and their clients since the Mortgage Market Review was introduced on the 26th April. While some comments may reveal initial teething troubles as lender staff get to grips with new rules and systems, it is worrying that 85% of advisers now find it longer and more difficult to get a mortgage case through.
This has also been clearly reflected in recent statistics from both the CML and the Bank of England showing a continuous drop in mortgage approvals.
While the mortgage application process will inevitably continue to take longer than it did before the MMR, it should start to get easier as everybody becomes more familiar with what is required of them and it will be interesting to see if the results of our survey in three months’ time show this to be a reality.”
