"Reducing a customer’s wait for a binding offer by five days is a huge reduction and what we have seen in the pilot is that the reduced delay significantly increases the possibility that the loan will complete."
- Buster Tolfree, director of mortgages at United Trust Bank
United Trust Bank Mortgages for Intermediaries is aiming to reduce second charge loan application to offer times by around five days by offering binding offers with special conditions, including first mortgage consent.
It is common for first mortgage lenders to place a restriction at the Land Registry that requires their consent to be provided before a second charge loan can be offered. Required consent is frequently the only item outstanding, delaying the second charge loan offer.
However, issuing a binding offer without consent, or without a special condition for consent, can technically place the borrower in breach of their first mortgage terms and conditions, potentially creating a poor customer outcome and contravening Consumer Duty.
From today, all UTB second charge loan binding offers can now be issued with special conditions for a range of non-affordability linked requirements. These requirements can then be provided after offer, but before completion.
Examples of where special conditions can be used include first mortgage consent to second charge, up to date redemption figures, bank details for items of debt consolidation, and deed of consent for non-dependent residents.
Buster Tolfree, director of mortgages at United Trust Bank, said: “We entered the second charge market to shake it up, and nearly 10 years on we’re still innovating and improving to grow the market and help our brokers complete more business.
“Speed to offer and completion is probably the most important success factor in a second charge loan application. Reducing a customer’s wait for a binding offer by five days is a huge reduction and what we have seen in the pilot is that the reduced delay significantly increases the possibility that the loan will complete. Both we and brokers waste less time on abandoned cases and are more productive and profitable as a result. And customers get their money quickly to crack on with their home improvements or alleviate their debt worries. It’s a real win-win-win!”
