Turnaround time turmoil

Advisers say turnaround times of two to three weeks are commonplace in the market, as banks struggle with rising demand and mortgage deferral requests. 

Turnaround time turmoil continues across the market, with big four banks taking anywhere from a week to three weeks to process mortgage applications. 

Additional questions about future financial security, more forms to complete, and mortgage deferral requests have been blamed for the slowdown.

Joel Oliver of SuperCity Mortgages said turnarounds of about ten working days were common. He described the delays as "embarrassing".

Craig Pope at Loan Market said "a two to three week turnaround" was the norm at the moment. 

Pope said borrowers were subject to intense scrutiny. 

"No matter how thorough we make an application, they [the banks] inevitably come back with a question or two, sometimes having not properly read through what has been sent. Or asking mundane questions, like 'what is a 43 year old's exit strategy for retirement?'"

Pope added: "As soon as they ask questions or request more info, we get put back down the bottom of the queue and then it takes even longer."

Geoff Bawden of Q Group said turnaround times were "a disgrace" across the main banks. He said lenders were asking clients unknowable questions about their future financial security.

"To seek declaration that a client will not be affected adversely by Covid in the future, which some lenders are now requesting, is laughable," Bawden added. "How the heck can any one provide an assurance around that, when we don't even know what effect Covid might have on the community or economy moving forward?"

Glen McLeod of Edge Mortgages said banks were "still inundated" with loans. 

"They are all between eight and 10 days at the present time," McLeod added.

The complaints about turnaround times come as ANZ, New Zealand's biggest bank, makes changes to try and reduce its backlog of deferral requests and new loan applications. 

The bank has reallocated staff from branch to handle broker applications, and has made some new hires to its adviser market team in recent weeks.


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