One of the most commonly searched for answers and something we get asked all the time is, “how long does a mortgage application take?” While there is no generic answer, we can let you know what is possible, what is to be expected and what coronavirus has done to current timescales.
“We’d say 3-4 weeks is an average application to offer timescale but it’s always dependent on circumstances which is why no-one can give you an answer before having some context.”
A property purchase transaction can be broken down in to the following three fundamental stages:
- Agreeing a purchase price
- Arranging the mortgage
- Sorting the legal work
Agreeing the purchase price, often through an estate agent, is always the first step after you’ve found a property. However, arranging the mortgage and sorting the legal work can be done in tandem and this is key when you’re wanting to progress as quickly as possible. If you’ve sought good quality mortgage advice and it’s simply a matter of time to wait for the mortgage offer, there’s no real reason not to instruct your solicitor or conveyancer to begin the legal work as the mortgage application progresses.
Once a mortgage application is submitted to a bank, they will request documents to verify your income and sometimes your identity and deposit too. They will also instruct a valuation of the property on their behalf. Providing the bank are happy with affordability, the valuation and of course, subject to credit checks, they will issue a mortgage offer. With some banks, this can happen within just 24 hours yet some this can take several weeks… If you’re in a hurry, it’s worth letting us know as we can choose a bank we know work fast! We’d say 3-4 weeks is an average application to offer timescale but it’s always dependent on circumstances which is why no-one can give you an answer before having some context. Coronavirus has caused delays in the sense that some banks have a back-log of applications meaning the underwriters who review the applications cannot look at them as soon as they come in. In the worst case this is causing delays of up to a month, but this is certainly just a minority of cases.
The legal work begins with instructing a solicitor or licensed conveyancer. Unsure of who to go to for this? We can sort you a competitive quote from a selection of licensed firms. Initially, searches need to be requested from the local authority to provide information on the property and the surrounding area. On average these take 6 weeks to come back which is normally enough time for the rest of the legal process to be wrapped up however due to staffing shortages and pressure on local authorities during the pandemic, we have heard some local authorities are taking longer. Let us know where you’re looking to buy and we can give you an idea of the current wait on searches. A regular cause for delay is slow communication between solicitors in relation to what they refer to as “responding to enquiries”. Your solicitor will likely have various enquiries to raise with the seller’s solicitor in relation to the complex legal aspects of transferring property ownership. From our experience, if you’re in a hurry it’s worth regularly chasing your solicitor; unfortunately, it seems it’s often those who shout loudest who get what they want in this situation… Other common delays are caused by the breakdown of the sellers purchase or anywhere else in the chain of people buying and selling. While you can’t account for this, be prepared for it – unless you’re buying a shiny new-build that’s ready and waiting for you!
With just 66 days of the current stamp duty holiday remaining, we’re at the very last chance saloon if you’re looking to move and take advantage of this. That being said, it may still be touch and go so if you want to know which bank’s going to give you the best chance of getting a quick mortgage offer, get in touch with us!
Finally, we often get asked, “how long does a mortgage offer last?” Typically, a mortgage offer will be valid for 3 months or 6 months depending on which bank we go to. This should give ample time for the legal process to conclude but sometimes there are unforeseen whether that’s a legal issue, a breakdown in the chain or even global pandemic! However, your offer expiring is likely not a huge problem. Banks will generally have no issue in extending the mortgage offer, providing there is an understandable explanation for the delay and a realistic timescale for when completion is likely.