Almost three-quarters of home buyers believe property buying has accelerated, putting brokers in a difficult position
Almost three-quarters of home buyers believe property buying has accelerated, putting brokers in a difficult position
A new survey has found that 73% of property buyers believe those in the market today need to make quicker decisions than five years ago.
In fact almost half of respondents said they, or a friend or relative who purchased recently, made an offer on the same day as inspection, the survey of 1000 Australians by lender Tic Toc revealed.
Lenders are struggling to keep up, warns Tic Toc’s CEO Anthony Baum: “Australians need faster home loans to keep up with the market. Now more than ever, buyers can’t afford to wait 22 days to have their home loan approved; they are expected to act immediately to avoid missing out to the next person in line.”
Bendigo and Adelaide Bank-backed Tic Toc made waves in July when it claimed a ‘world first’ in offering 22-minute mortgages, drawing data from CoreLogic and Equifax.
Is lending keeping up?
Whilst many potential buyers get pre-approved, getting a mortgage remains a slow process.
In fact, the average time to originate a mortgage is 42 days, according to processing technology provider MoneyCatcha.
Whilst this technology for faster origination does exist, Tic Toc’s Baum explains, “traditional lenders have been slow to react because there is a lot of work involved in automating the process and customers have become conditioned to expect home loans to be time-consuming.”
Worryingly for brokers, the fastest routes to a mortgage often sideline third parties, such as Tic Toc or NAB providing pre-approvals on realestate.com.au. These lenders often exclude high LVR clients or those from certain areas, however.
Turnaround times have been a challenge for the lenders that do deal with brokers; in our most recent Brokers on Banks report 40% of respondents said turnaround times had got worse.
The danger of hasty decisions
Whilst the acceleration of the home-buying process could be bad news for brokers, it could also be bad news for buyers.
In Tic Toc’s survey of buyers, almost half (46%) revealed they did not get a building inspection, strata report or pest report before they made an offer on a property. One in five were asked to exchange contracts immediately after making an offer on a property or to accept a shorter settlement period, under 45 days.
Baum warns borrowers against hasty buying, particularly if they haven’t been pre-approved. “While it can be an advantage to act quickly, it’s important the customer has done the necessary checks and measures – including seeking finance – before making a hasty decision to purchase which they may regret.”
A new survey has found that 73% of property buyers believe those in the market today need to make quicker decisions than five years ago.
In fact almost half of respondents said they, or a friend or relative who purchased recently, made an offer on the same day as inspection, the survey of 1000 Australians by lender Tic Toc revealed.
Lenders are struggling to keep up, warns Tic Toc’s CEO Anthony Baum: “Australians need faster home loans to keep up with the market. Now more than ever, buyers can’t afford to wait 22 days to have their home loan approved; they are expected to act immediately to avoid missing out to the next person in line.”
Bendigo and Adelaide Bank-backed Tic Toc made waves in July when it claimed a ‘world first’ in offering 22-minute mortgages, drawing data from CoreLogic and Equifax.
Is lending keeping up?
Whilst many potential buyers get pre-approved, getting a mortgage remains a slow process.
In fact, the average time to originate a mortgage is 42 days, according to processing technology provider MoneyCatcha.
Whilst this technology for faster origination does exist, Tic Toc’s Baum explains, “traditional lenders have been slow to react because there is a lot of work involved in automating the process and customers have become conditioned to expect home loans to be time-consuming.”
Worryingly for brokers, the fastest routes to a mortgage often sideline third parties, such as Tic Toc or NAB providing pre-approvals on realestate.com.au. These lenders often exclude high LVR clients or those from certain areas, however.
Turnaround times have been a challenge for the lenders that do deal with brokers; in our most recent Brokers on Banks report 40% of respondents said turnaround times had got worse.
The danger of hasty decisions
Whilst the acceleration of the home-buying process could be bad news for brokers, it could also be bad news for buyers.
In Tic Toc’s survey of buyers, almost half (46%) revealed they did not get a building inspection, strata report or pest report before they made an offer on a property. One in five were asked to exchange contracts immediately after making an offer on a property or to accept a shorter settlement period, under 45 days.
Baum warns borrowers against hasty buying, particularly if they haven’t been pre-approved. “While it can be an advantage to act quickly, it’s important the customer has done the necessary checks and measures – including seeking finance – before making a hasty decision to purchase which they may regret.”
