Paradigm Mortgage Services and Foundation Home Loans have teamed up with Castlight Financial to launch a tool allowing brokers to process mortgages in under 10 minutes.
The Affordability Passport, which is now being piloted, is powered by open banking technology to provide a platform for prospective borrowers to share their transactional data in real time with a lender.
The service then uses a categorisation engine, developed by Castlight Financial, to categorise the prospective borrower’s income and discretionary and non-discretionary expenditure into more than 150 different categories.
John Cofield, head of mortgages at Paradigm, said: "Technology remains a common buzz word in the industry, and at Paradigm we are committed to offering advisers access to technology that will benefit both them and their clients. In this initiative, there are tangible benefits and therefore I’m sure it will be positively received by advisers."
The tool means there is no need for a broker to trawl through bank statements and payslips to ensure anti-money laundering compliance.
In fact, a lender does not need to see any paperwork at all as the Affordability Passport provides the transactional information on which to base a fast, informed and compliant lending decision.
Martin Leonard, chief operating officer at Glasgow-based Castlight Financial, said: “We believe it's good news for the wider mortgage industry as the Affordability Passport, at its very heart, is a tool for ensuring that borrowers borrow safely and lenders lend safely. It’s a tool designed to ensure financial security and that’s a good thing for everyone.
"We are looking forward to the broker and client feedback which will be an integral element of this important pilot.”
Andrew Ferguson, commercial director at Foundation Home Loans, said: "Castlight Financial’s system has proven easy to use and upholds our pragmatic and straight-forward approach. We are confident the exclusive offer will prove invaluable to brokers and clients, facilitating faster decision-making and removing the need to chase bank statements.
"Thanks to our working partnership with Paradigm Mortgage Services, we expect more lenders and distributors to follow suit."
Kusal Ariyawansa, a chartered financial planner at Manchester-based Appleton Gerrard, said: "Whilst we're able to advise and make a recommendation after due consideration it is the application process that can be frustrating. It's high time technology was used to make the mortgage application process faster. At present it is painfully slow and inefficient."