Acceptable waiting time for mortgage approval

T

Tired Paul

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Friend of mine applied for mortgage through a broker a number of weeks back. having discussed it with him over the weekend I was surprised to learn that he still hasn't got an answer.
Now I don't know his full financial details but he is in a well paid job and his wife works part time. They applied with the broker on the 7th March and each week they call him looking for feedback. Apart from updating the broker with more letters from work 5 weeks ago they still have no definite news.
Latest update is that the application is with the credit department with one of the banks the broker applied to, but this was last week.
Does anyone think that their application is in actual fact being considered or are they getting a run around from their broker.
I know there could be thousands of mitigating circumstances but I'm just looking at this from a broader view point.
 
In the absence of some mitigating circumstance it does not appear to be normal. An application should be fully handled and approval in principle given or else refused within about 10 business days. If there were something less straightforward with the application perhaps a bit longer, but two months is not reasonable for pillar to post.

Perhaps they should consider applying directly to the banks.
 
Speaking as a broker, this seems questionable. Typical turnaround time is 5 - 10 working days. If you've sent in absolutely everything on the first go, that could mean you get a decision within that time. Or it could mean that the bank comes back after 5 - 10 days asking for more statements or information. But your friend should be aware if the latter happened.

As you say, there could be all manner of mitigating facts we're all unaware of.
 
Thanks for the replies so far. It all makes sense to me that this does seem to be taking a very long time. As I said already it appears that the decision is currently waiting on some approval at the " credit department" and there should be final news before the end of the week.
Seems like an extremely long winded excreise if there is going to be a negative outcome at the end??????
 
With apologies to LDFerguson, but I have never understood why mortgage brokers exist.
 
cremeegg said:
With apologies to LDFerguson, but I have never understood why mortgage brokers exist.
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If you want, you can avoid going to a mortgage broker by doing all the research yourself. You can find out from each lender what their suites of rates are, what the lending policies of each are, how much each will lend in your particular circumstances etc. You can also find out from each one what the differences are between their products; e.g. some lenders allow you to make lump sum overpayments even though you're in a fixed rate; some don't. Some people don't want to do that amount of work and research themselves and so will go to a mortgage broker who has it already done for them.

If you want to find out for certain how much each lender will offer you, you'll have to put together a full application and all supporting documentation for each one. Approval in principle without submitting an application and financial evidence isn't worth the paper it's written on. A mortgage broker can apply to several lenders using just the one application.

I don't know what's going on with the original poster's application, but a good mortgage broker will keep you updated as to the progress of your application, rather than you having to chase each lender.

A fundamental difference is that a bank official works for the bank. A good mortgage broker works for you.
 
ryaner said:
Our of curiosity, are all brokers required to have a fiduciary responsibility to their clients?
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This is from the Consumer Protection Code.

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[/FONT]A [FONT=Calibri,Calibri][FONT=Calibri,Calibri]regulated entity [/FONT][/FONT][FONT=Calibri,Calibri][FONT=Calibri,Calibri]must ensure that in all its dealings with [/FONT][/FONT][FONT=Calibri,Calibri][FONT=Calibri,Calibri]customers [/FONT][/FONT][FONT=Calibri,Calibri][FONT=Calibri,Calibri]and within the context of its authorisation it: [/FONT]
[FONT=Calibri,Calibri]2.1 acts honestly, fairly and professionally in the best interests of its [/FONT][/FONT][FONT=Calibri,Calibri][FONT=Calibri,Calibri]customers [/FONT][/FONT][FONT=Calibri,Calibri][FONT=Calibri,Calibri]and the integrity of the market; [/FONT]
[FONT=Calibri,Calibri]2.2 acts with due skill, care and diligence in the best interests of its [/FONT][/FONT][FONT=Calibri,Calibri][FONT=Calibri,Calibri]customers[/FONT][/FONT][FONT=Calibri,Calibri][FONT=Calibri,Calibri]; [/FONT]
[FONT=Calibri,Calibri]2.3 does not recklessly, negligently or deliberately mislead a [/FONT][/FONT][FONT=Calibri,Calibri][FONT=Calibri,Calibri]customer [/FONT][/FONT][FONT=Calibri,Calibri][FONT=Calibri,Calibri]as to the real or perceived advantages or disadvantages of any product or service; [/FONT]
[FONT=Calibri,Calibri]2.4 has and employs effectively the resources, policies and procedures, systems and control checks, including compliance checks, and staff training that are necessary for compliance with this Code; [/FONT]
[FONT=Calibri,Calibri]2.5 seeks from its [/FONT][/FONT][FONT=Calibri,Calibri][FONT=Calibri,Calibri]customers [/FONT][/FONT][FONT=Calibri,Calibri][FONT=Calibri,Calibri]information relevant to the product or service requested; [/FONT]
[FONT=Calibri,Calibri]2.6 makes full disclosure of all relevant material information, including all [/FONT][/FONT][FONT=Calibri,Calibri][FONT=Calibri,Calibri]charges[/FONT][/FONT][FONT=Calibri,Calibri][FONT=Calibri,Calibri], in a way that seeks to inform the [/FONT][/FONT][FONT=Calibri,Calibri][FONT=Calibri,Calibri]customer[/FONT][/FONT][FONT=Calibri,Calibri][FONT=Calibri,Calibri]; [/FONT]
[FONT=Calibri,Calibri]2.7 seeks to avoid conflicts of interest; [/FONT]
[FONT=Calibri,Calibri]2.8 corrects errors and handles [/FONT][/FONT][FONT=Calibri,Calibri][FONT=Calibri,Calibri]complaints [/FONT][/FONT][FONT=Calibri,Calibri][FONT=Calibri,Calibri]speedily, efficiently and fairly; [/FONT]
[/FONT][FONT=Calibri,Calibri][FONT=Calibri,Calibri]2.9 does not exert undue pressure or undue influence on a [/FONT][/FONT][FONT=Calibri,Calibri][FONT=Calibri,Calibri]customer[/FONT][/FONT][FONT=Calibri,Calibri][FONT=Calibri,Calibri]; [/FONT]
[FONT=Calibri,Calibri]2.10 ensures that any [/FONT][/FONT][FONT=Calibri,Calibri][FONT=Calibri,Calibri]outsourced activity [/FONT][/FONT][FONT=Calibri,Calibri][FONT=Calibri,Calibri]complies with the requirements of this Code; [/FONT]
[FONT=Calibri,Calibri]2.11 without prejudice to the pursuit of its legitimate commercial aims, does not, through its policies, procedures, or working practices, prevent access to basic financial services; and [/FONT]
[FONT=Calibri,Calibri]2.12 complies with the letter and spirit of this Code. [/FONT][/FONT]
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Quote:
Originally Posted by LDFerguson
"A fundamental difference is that a bank official works for the bank. A good mortgage broker works for you."



Any mortgage broker, good or bad, works for him or herself.

Some brokers may recognise that the the borrower is their client, but are they not all paid by the lender? And then only if the loan is actually taken out?

Taking on a mortgage is a large financial commitment and any sensible borrower will educate themselves about that as much as possible.
 
If its any help when I was applying for a mortgage in 2009 it took longer then normal as I had a personal loan and this was a stumbling block as far as the brokers were concerned, it took a total of 3 weeks if I remember to be accepted for a mortgage even though I had an excellent credit rating and had provided all of my documents.
 
cremeegg said:
Quote:
Originally Posted by LDFerguson
"A fundamental difference is that a bank official works for the bank. A good mortgage broker works for you."



Any mortgage broker, good or bad, works for him or herself.
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Yes, but that's not my point. A mortgage broker won't get paid commission unless the borrower (a) chooses to place their business with the broker and (b) is approved for and proceeds with the loan.

In order to ensure (a) then the broker must provide a professional service. Otherwise the prospective client can always go elswhere.

In order to ensure (b) the broker must know as much as possible whether or not it's worth while proceeding with an application, to avoid wasting their own or the client's time. It's also in the broker's interest to present the case highlighting as many positive attributes as possible over and above the bare minimum documentation required, so as to maximise the client's chance of approval.

A bank employee gets paid their salary at the end of the month regardless of whether or not the people they've dealt with apply for, or get approved for mortgages.

cremeegg said:
Some brokers may recognise that the the borrower is their client, but are they not all paid by the lender? And then only if the loan is actually taken out?
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Some brokers also charge fees for their services; others don't. But that's a side point.

For the reasons I've mentioned above, a mortgage broker's interests are more closely aligned with the client than those of the bank. A mortgage broker will only get paid commission if the client gets what they want: an approved and drawn-down mortgage. A bank employee gets paid regardless of whether or not the client gets what they want.

cremeegg said:
Taking on a mortgage is a large financial commitment and any sensible borrower will educate themselves about that as much as possible.
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Agreed. Sadly, my experience is that many borrowers don't educate themselves as much as they should before taking on the commitment. The people who hang out here on Askaboutmoney.com are generally a lot more savvy than those who don't - that's why they come here. But as popular as Askaboutmoney.com is, there's an awful lot of people who fit the profile of the character in the old Central Bank TV adverts; "I don't know what a tracker mortgage is."
 
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