2-hour home loan approval: Can it happen?
A new partnership between digital bank 86 400 and Mortgage Choice aims to deliver unconditional home approval within as little as two hours – can it really happen?
Neobank 86 400 has announced a new partnership with established broker brand Mortgage Choice, which aims to offer seamless digital home loans with unconditional approval within as little as two hours.
It sounds like an incredible promise, especially at a time when some of the major banks have experienced huge delays in their loan processing and turnaround times. In the wake of COVID-19, some of the major banks have been taking several weeks – and even months – to assess a loan application.
All of which makes this offer from 86 400 even more promising. But is a two-hour loan approval turnaround genuinely available or is this more of a marketing gimmick than a standard benchmark for all customers?
George Srbinovski, national manager broker distribution of 86 400, says a fast turnaround time with unconditional approval within hours is definitely achievable.
"We're able to begin assessing the application as soon as it has been submitted by the broker, and once we receive an application from a broker, the fastest time we've been able to go back to them and their customer with an unconditional approval is just under two hours," he confirms.
"While our personal best sits at this benchmark of just under two hours, we aim to have all applications back to the broker with a decision in under 24 hours."
There are some aspects to be aware of if you're a borrower seeking this type of faster home loan approval, he adds: "At the moment, we only accept LVR below 80%, so the borrower would need to also fit that criteria."
But overall, Srbinovski says the digital bank intends to revolutionise the often-clunky home loan process by changing customers' expectations around turnaround times and service levels.
Emma Dupont-Brown, general manager of product and corporate communications at Mortgage Choice, says this new partnership will also help to streamline the loan application process and minimise the cumbersome paperwork "pain point" for borrowers by adopting a digital process.
"Neobanks are leading the way for customer experience when it comes to home loan applications, and this new partnership with 86 400 means that our customers can enjoy a digital home loan application process, which means a lot less paperwork, effort and inconvenience," Dupont-Brown says.
"When it comes to the validation of the applicant's income and living expenses, this is done via a secure portal. The applicant grants access to 12 months of income and three months of expenses, which saves the applicant time as they don't have to go through the steps of downloading all their statements and sending them to the lender."
When the customer needs to sign any documentation, even this is completed digitally – paving the way for an end-to-end home loan process that can be carried out by the borrower wherever is most convenient to them.
"It's a seamless process for the consumer and I think we can expect more banks to adopt this process into the future," Dupont-Brown says.