The CML said in a statement that in its interpretation: “The seven day period would only begin once all the necessary risk assessments, affordability checks, and confirmation to the customer has been given.
The government’s seven day mortgage switching proposal is achievable if the timeframe begins once risk assessments and affordability checks take place, the Council of Mortgage Lenders has indicated.
The CML said in a statement that in its interpretation: “The seven day period would only begin once all the necessary risk assessments, affordability checks, and confirmation to the customer has been given.
“If that is the correct interpretation, then many lenders would potentially already be operating to the seven day timescale for completion.”
The CML noted that the government specified the seven day period beginning "when the consumer gives their consent to switch to the new provider, and the new provider accepts that customer".
Paul Smee (pictured), CML director general, said: “We fully support the switching principles, and our members have long recognised that speed, as well as cost and service, is frequently valued highly by remortgage customers.
“However, whether a seven day target is realistic, given tasks that lenders need to complete to fulfil risk and regulatory requirements, depends on when the clock starts ticking.”
The CML said regulatory requirements like carrying out a valuation when remortgaging makes it harder for the mortgage market compared to other sectors to enable seven day switching.
The trade body added that there is no evidence that timescales to complete remortagages are an obvious barrier to remortgaging, especially since remortgages accounted for 25% of total mortgage lending in 2015 and with the high degree of intermediation in the market consumers are given a helping hand to switch.
A spokesman from the government’s Department for Business, Innovation and Skills refused to further clarify when the seven day timeframe will start from until consultation takes place.
He said: “We’re currently in the position of looking at it from a broader lens.
“We encourage feedback as the more views we get the better we will make the policy.”
