Move your mortgage in a week
It usually takes at least a month to switch your homeloan to a new lender, but now government ministers want lenders to complete remortgages within just seven days.
The Better Markets Bill would see the new seven-day service in action as early as next year, with the government hoping to extend seven-day switching to most services including mobile unlocking, and remortgaging.
Business secretary Sajid Javid, acknowledged that many consumers fear that changing some services is too cumbersome and difficult. But, mortgage providers will be asked to offer the same standard of service that banks must offer those who change their current accounts.
Instead of the four to eight weeks it usually takes to change mortgages, like current account holders, customers could be guaranteed that all changes complete within seven working days, with the bank liable for any errors.
Mark Harris, chief executive of mortgage broker SPF Private Clients, said: “Under the proposals, not only will borrowers be relying on lenders to process the case in seven days, the bank will also require a valuation of the property to be carried out. This will be less of an issue on lower loan-to-values as AVMs (automated valuation models) are available. The latter would have to become more commonplace in order to make a seven-day switch achievable.
“If the borrower gets into the habit of switching their mortgage frequently because it is easier to do so, then numerous credit checks could affect their credit rating, subsequently damaging their long-term prospects.”