Paperless Mortgages: Game Changer In The Industry?
Given the importance of the mortgage industry in the United Kingdom, when there is a change to the way that a lender operates, it is always likely to be big news. This is why the NatWest managed to grab a lot of headlines recently when they announced that they are introducing a paperless mortgage. This will initially be introduced to clients who use the telephone system to apply for a mortgage but the lender is also looking to roll this facility out to all of their advisors in branch.
While the company has talked of a huge environmental impact of reducing the paper they use, for most people, the key aspect of a paperless mortgage comes with the speed of service. This digital mortgage process should be a lot quicker to complete and there are many specialists who believe that paperless mortgages are of benefit and that they will become an integral part of the mortgage industry. You only have to consider the way that the digital age has impacted and affected so many areas to know that this is a genuine game changer.
NatWest believe digital mortgages will save time
With respect to speeding up the process, NatWest are on record in stating they expect the digital process to be concluded in ten fewer days than the traditional process. There was a trial in the United States in 2016 that managed to remove 16 days from the process, which is definitely something that many applicants will be pleased with. Anything which reduces the application time and the waiting period to hear if your application has been successful has to be seen as a good thing.
However, it would be fair to say that not everyone is positive about this change and security issues are a reason for the reluctance to switch over to a fully digital process. Lenders need to be sure that they are providing funds to the right person and for the right purpose and it may be that removing a face to face element will diminish the robustness of the process. NatWest have provided examples of how they will verify applicants and they believe their process is secure but you can see why many firms are watching on with interest. If NatWest can prove that this process is secure, other firms will likely follow but until then, you can see why some organisations are not keen to press ahead with paperless mortgages.
There is a difference of opinion in the industry
The Yorkshire Bank and Virgin Money have both stated that they have no immediate plans to provide paperless mortgages to their clients. Other organisations such as the HSBC and the Halifax say that they utilise some digital processes and while they will likely introduce further digital processes in the future, it is not something that they expect to do soon.
There is no denying that paperless mortgages have the potential to be a game changer in the industry and by moving first in the United Kingdom, it may be that NatWest steals a march on their rivals. However, given the huge sums of money involved with mortgages and the importance of these deals, you can see why many people and lenders are erring on the side of caution. There is familiarity in traditional ways and until more people are absolutely certain that digital application methods are robust, there may be a delay in the roll-out of paperless mortgages across the industry.
This is certainly an area that will become more prominent though and it may just be a matter of time until paperless mortgages are part and parcel of the mortgage process in the UK.