View more on these topics

Processing costs rose 69% in the past year

Mortgage lenders’ processing costs have risen by up to 69%in the past year, around 123m for the sector as a whole, Marlborough Stirling’s latest mortgage benchmarking study reveals.

This is the third year Marlborough Stirling has conducted the study, developed in consultation with the Council of Mortgage Lenders. Some 18 lenders took part, making this the most comprehensive survey yet. The scope this year widened to include arrears and customer retention as well as point-of-sale, application processing functions and intermediary business as in 2004.

The average cost of processing applications rose from 89.67 per case in 2004 to 146.49 in 2005, up 69%. This follows a cut in processing costs in the previous year from around 116 per application in 2003. If all lenders experienced similar rises, the total would be as much as 123m for the sector.

As well as the increased cost of processing, the study shows lenders are processing fewer applications per consultant this year than in 2004, with productivity per employee dropping from 1.70 completions per day in 2004 to 1.18 per day in 2005. This is lower than in 2003 when applications per consultant averaged 1.56 per day.

Time taken to process applications improved to an average of 14 days for new business, compared with 16 in 2004 and 2003.

David Edwards, managing director of Marlborough Stirling’s mortgage business, says: “The improvements in processing in 2004 have been reversed in 2005. Regulation is probably a major factor in this.”

Recommended

New home for Nemo

Nemo Personal Finance has opened its new offices at Trafalgar House, Cardiff following rapid growth and a strong first six months of trading.The secured personal loans company launched for business in February 2005. Under the leadership of managing directors Phil Jones and Sam Marshall, business volumes have exceeded forecasts and the company now has more […]

Landlords are optimistic

Landlords expect the net value of their portfolios to grow by 5% over the next 12 months, research from Paragon Mortgages reveals. This is the highest growth expectation for over a year.

Money Partners is admitted to CML and IMLA

Specialist lender Money Partners has announced it has been admitted as a full member of the Council of Mortgage Lenders and the Intermediary Mortgage Lenders Association.Money Partners was previously an associate member of the CML. Colin Sanders, chief executive officer of Money Partners, says: “As we approach the first anniversary of our launch, Im delighted […]

Planning powers for Thames Gateway Development

The London Thames Gateway Development Corporation will gain strategic planning powers from October 31 2005.LTGDC will become the local planning authority within a designated area in the Lower Lee Valley and London Riverside, from Beckton to Rainham with responsibility for determining strategic and large scale planning applications. Other developments will continue to be determined by […]

piggy, cash, money

A tailored approach to protection

By Ian Smart, Product Architect, Royal London In an ideal world, clients would be able to afford as much protection cover as they wanted, but few would describe current times as anything approaching ideal. But this doesn’t mean that they have to indulge in an either/or decision that results in missing out on some essential […]

Newsletter

News and expert analysis straight to your inbox

Sign up