The slowest mortgage lenders revealed that take up to 12 days on average to approve your loan – and the quickest
MAJOR lenders are still taking up to two weeks to approve a mortgage – despite a huge drop in applications over the last few years.
Mortgage approvals rose to 61,300 in March, a slight increase from 60,500 the month before and the highest number since September 2022, according to the Bank of England (BoE).
The sixth consecutive monthly rise since last September followed a significant fall in mortgage rates over the last year, driving more people to look to fix a home loan.
But mortgage approvals are still low compared with three years ago. May 2021 saw around 87,500, with approval numbers peaking in December 2020 at 103,200, indicating a far higher volume of applications.
At that time, brokers were reporting average wait times of around two weeks.
Approval numbers have fallen 40% since then, but wait times at some top lenders haven’t changed all that much.
We looked at eight of the UK’s biggest lenders, based on UK finance data, and found significant differences in how long they currently take to approve loans.
We excluded NatWest from the list above as its timescales were not comparable, but you can see what the bank says below.
Leeds Building Society, which has around 700,000 customers, says its average wait time between receiving a home loan application and approval is 11.8 days as of May 1.
Meanwhile, Virgin Money says online that its mortgage approval time frame averaged 11 days as of the same date.
Nationwide and Barclays say they typically take 10 days to approve a mortgage, while Skipton Building Society currently averages just over nine days to get a loan approved, according to its website.
Coventry Building Society, HSBC and Santander take nine days, six days and five days, respectively.
That makes Santander lender the fastest lender of those we looked at.
NatWest says it typically processes 43% of applications within seven days and 30% within 8 to 14 days.
It’s important to note that these are all average wait times, meaning some customers will see their loans approved faster – but some could be waiting much longer.
While waits remain long, Nicholas Mendes, from broker firm John Charcol, said they are down slightly now compared to earlier in the year, as mortgage rates have increased slightly which has put some buyers off.
“With mortgage rates increasing in recent weeks, there has been a slight reduction in applications as homebuyers delay committing to a deal in anticipation that the direction of mortgage rates will reduce over the next few months,” he said.
“Market conditions have also meant that lenders have been more cautious in their pricing.
“This means having a considerably cheaper deal in the current market would inevitably result in a sudden influx of applications and that could impact their service levels.”
He added that the current slowdown in applications should have “provided lenders with the opportunity to work through their existing pipeline and process any new applications in a quicker time frame compared to earlier in the year.”
While some customers are still waiting weeks, Mr Mendes is optimistic that new technology could start to speed things up.
“We are starting to see the influence of technology within the underwriting process, which significantly reduces the time from application to offer,” he said.
A spokesperson for Leeds Building Society, the slowest lender we found, said: “Leeds Building Society is committed to providing efficient and timely service and our customers tell us that we are doing so.
“Published timescales for processing mortgage applications are based on the last seven working days and are reflective of high volumes of mortgage applications and the complexity of individual cases.
“Our average mortgage application to offer processing time this year is 10 days.”
What else can slow down getting a mortgage approved?
It’s not just a backlog behind the scenes at lenders which can slow down the process of having a mortgage approved.
Your own situation can impact how long it takes to process your mortgage, but there are things you can do to speed things up.
Here are three other ways it can be delayed and what you can do about it.
Your personal circumstances and credit history
If you’re employed, have no considerable outgoings and have saved up a good deposit, it’s likely you won’t have to pass over too many documents to the lender and should find your process fairly smooth.
But someone with a more complex financial situation might find there is a bit more back and forth, as lenders want to ensure you will be able to keep on top of your payments.
For example, if you’ve got a bad credit rating, you can expect the lender to ask for more evidence you can reliably pay before approving a mortgage.
The same goes for if you’re self-employed as you may not have a reliable monthly income.
If you’re not on the electoral roll, this can dent your credit rating too, making the process of getting accepted on a loan slower.
Getting registered to vote could boost your score, but if you’re still low after this, it could be worth focusing on building your rating before applying for a home loan.
We revealed last month how one dad cleared his debts and boosted his score 300 points by using a simple tool, and now he’s a homeowner.
Your lender’s underwriting process
Some lenders are more up-to-date with the latest technology and require less physical paperwork than others.
Others have started using auto-income verification tools as well.
All of this can make the process of getting a home loan approved quicker.
If you’re getting help applying for a mortgage from a broker, a good one will be able to tell you which lenders offer the quickest route to approval.
Remember that if you are in a unique or complicated financial situation or the property you’re buying is unusual, you may have a more limited choice of lenders than other buyers.
Other firms in the process
Bear in mind, it’s not just you and the lender involved in the mortgage approval process.
Hold-ups with your conveyancer, surveyor, accountants or with the broker can all see your approval time stagnate.
Keep on top of your solicitor to ensure you don’t end up at the bottom of their pile of customers and be sure to get any appointments booked as quickly as possible.
How to apply for a mortgage
HERE'S everything you need to know..
The first thing you’ll want to do is review your finances so that you know what you can afford being applying.
Lenders will only offer you a mortgage if they’re confident you can afford the repayments.
They will factor in income, outgoings, credit history and existing debts to see whether you are financially set.
Once you’ve done this, you can use an online mortgage calculator to figure out how much you might be able to borrow.
Most lenders have them on their websites.
Once you’ve done this, you’ll have to decide if you want to research mortgages yourself or use a broker.
A broker may charge commission but they’ll be able to give you the best options for a home loan.
If you go with a broker, you’ll need certain documentation to hand, including a passport, bank statement, P60 and payslips.
Once you’ve found a mortgage deal you’re happy with, you’ll next have to get an agreement in principle (AIP) from a mortgage provider.
This is not a guaranteed mortgage offer but an indication of how much it is willing to lend you.
You can go to an estate agent armed with an AIP, which can make you more attractive to sellers as it shows you’re more likely to get the mortgage you want and won’t hold up the selling process.
Once you’ve found a property you like, you can submit an offer through an estate agent, which if accepted means you can apply for a mortgage.
The lender will review your application and carry out a full credit check – an in-depth look at your financial activity.
If this is healthy it will give you a formal mortgage offer, usually within four weeks.
Once a formal mortgage offer has been made, it’s usually valid for six months.
The house-buying process on average takes around 15 weeks so you’ll have the time needed to complete.
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