Mortgage lenders urged to go digital to streamline borrowing process

Mortgage lenders urged to go digital to streamline borrowing process [Photo: Courtney Keating via iStock]

Mortgage lenders have been urged to bring their practices into the 21st century in order to make it easier for people to get a house purchase loan in a less time-consuming manner. 

At the moment, when buyers have to provide details of their income and outgoings, as well as identity, most lenders still insist that they come armed with paper copies of things like bank statements and bills. However, in an age where many people are completely paperless, this method has been heavily criticised.

According to data intelligence specialists GBG, the process as it is at the moment is completely outdated, especially when the majority of people who are coming to banks and lenders looking for a mortgage will be younger borrowers, who are far more likely to have paperless documentation.

Its survey showed that at the moment, as many as 69 per cent of people receive paperless bank statements, while 46 per cent never receive a physical paper copy of their credit card bills, which means it's inconveniencing them to have to print these out. 

These figures are even higher when it comes to younger people, with 75 per cent of those aged between 18 and 24 likely to get their bank statements via paperless methods. 

And it's a similar story when it comes to utility bills. Some 42 per cent of people said they do not have any paper copies of their gas and electricity bills, with more than a third receiving these documents through email rather than through the post. 

"These paper first procedures had to be put in place to sort the good from the bad. However, it’s clear these old-fashioned measures haven’t caught up with what’s actually happening in the real world," said Nick Brown, group managing director at GBG .

"And as more customers opt to receive paperless statements and access their documents online, these traditional processes could hinder a legitimate individual’s chance of getting on the property ladder," he added.