Industry calls for fewer failed transactions and higher standards
A group of mortgage lenders has expressed support for the government’s consultation on changes to the home buying and selling process, describing the move as a necessary step towards updating a system that has seen little change in recent decades.
According to Kate Davies (pictured top), executive director of the Intermediary Mortgage Lenders Association (IMLA), mortgage lenders back efforts to make transactions quicker, more transparent, and less stressful for consumers, while also aiming to cut unnecessary costs across the sector.
“Buying or selling a home is the most significant financial transaction most people will ever make — yet the system that underpins it has barely evolved in decades,” Davies said. “Far too many sales collapse unnecessarily, creating frustration for consumers and inefficiency for the industry. Every failed transaction is wasted time, money and emotional energy for borrowers, sellers and the many professionals involved.
“Lenders welcome any reform that helps reduce these failures, introduces greater clarity and harnesses technology to deliver a smoother experience. The current process is ripe for change.”
IMLA identified four key priorities for lenders in the consultation. The first is reducing failed transactions. Currently, about one in three property transactions fall through, resulting in significant financial loss for buyers, sellers, and lenders who have already invested in affordability checks and underwriting.
“Every sale that collapses after mortgage approval represents an avoidable loss for buyers, for sellers and for lenders who have already completed affordability assessments and underwriting,” Davies said. “Reducing those failures will deliver real savings and greater confidence.”
The second priority is improving clarity and reducing stress. The association noted that clearer information from the outset could lead to fewer unexpected issues later in the process. “Providing upfront information and standardising documentation will make the system fairer, more transparent and less nerve-wracking for everyone involved,” the IMLA director pointed out.
The third area is embracing technology. While lenders have made progress in digitising their processes, Davies noted that benefits will only be fully realised when all parties in the property chain adopt modern systems. “Digital logbooks, verified data and interoperable systems are key, but there is still work to do to make these tools consistent and secure across the market,” she said. “Industry and government must collaborate to create uniform standards that all parties can trust.”
The fourth priority is raising professional standards. Davies welcomed proposals for mandatory qualifications for estate agents and a new code of practice for property professionals. “Mortgage lenders and advisers operate in one of the most highly regulated sectors of the economy, and advisers must achieve rigorous qualifications before advising consumers,” she stressed. “It is extraordinary that such standards have not yet been applied to estate agents, given the importance of their role in the property chain. Professionalising the estate agency sector will help rebuild public trust and create a smoother, more accountable home buying process.”
Davies also suggested that updating the process could encourage more activity in the market and restore consumer confidence. “The current system is so clunky and unpredictable that it can be genuinely demoralising for many would-be buyers,” she said. “Some simply give up altogether, and that can’t be good for the housing market or the wider economy.
“We need more movement at every level of the ladder, enabling people to enter the market, move up as their families grow and downsize when the time is right. A modern, reliable process would help unlock that natural mobility.”
Davies concluded: “The government’s consultation is a chance to bring the property transaction process into the 21st century. Lenders stand ready to play their part in delivering a system that is faster, clearer, more consistent and more professional, for the benefit of consumers and the wider economy.”
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