You are here: Home - Mortgages - First Time Buyer - News -

Gap between exchange and completion growing

0
Written by: Samantha Partington
12/11/2020
Turnaround times between the exchange of contracts and completion have lengthened as the booming demand to move home causes delays right through the homebuying process

The drawn out exchange to completion turnaround time is a sign that the market as a whole is under strain from the volume of mortgage business, according to Kevin Roberts, director of Legal & General Mortgage Club.

Speaking to an online audience of mortgage intermediaries at The Mortgage and Protection Event 2020 run by our sister title, Mortgage Solutions, Roberts revealed brokers have already reported that mortgage offers are taking, in some cases, four weeks longer to obtain than they did pre-pandemic due to high demand and more complex underwriting processes.

Meanwhile delays obtaining local authority searches and a lack of capacity among conveyancers to manage the increasing workloads is slowing down the post-offer part of the transaction.

L&G Mortgage Club noticed the gap between the final two stages of the homebuying process had widened because its overdraft facility for procuration fee payments (commission to brokers) was near to reaching record levels.

L&G allows its advisers to claim their proc fees in advance by requesting payment from the club when contracts exchange, instead of when the sale completes.

L&G honours the request and is reimbursed when the lender releases the proc fee on completion. But the club is now waiting longer for the proc fees to wind up in its coffers.

Roberts said: “It’s great for you guys [brokers] using the [advance payment facility], you are claiming your proc fee early, but for me it is more of a risk and I watch that metric very carefully as you can imagine.”

There are 0 Comment(s)

If you wish to comment without signing in, click your cursor in the top box and tick the 'Sign in as a guest' box at the bottom.

The savings accounts paying the most interest

It’s time to get your finances in shape, and moving your cash savings to a higher paying deal is a good plac...

Everything you need to know about being furloughed

Few people had heard of ‘furlough’ before March 2020, but the coronavirus pandemic thrust the idea of bein...

The experts’ guide to sorting out your personal finances in 2021

From opting to ‘low spend’ months to imposing your own ‘cooling-off period’, industry experts reveal t...

What will happen if rates change

How your finances will be impacted by a rise in interest rates.

Regular Savings Calculator

Small regular contributions can build up nicely over time.

Online Savings Calculator

Work out how your online savings can build over time.

Having a baby and your finances: seven top tips

We’re guessing the Duchess of Cambridge won’t be fretting about maternity pay or whether she’ll still be...

Protecting family wealth: 10 tips for cutting inheritance tax

Inheritance tax - sometimes known as 'death tax' - can cause even more heartache for bereaved families. But th...

Travel insurance: Five tips to ensure a successful claim

Ahead of your summer holiday, it’s important to make sure you have the right level of travel cover or you co...

Money Tips of the Week