United Trust Bank (UTB) Mortgages for Intermediaries is seeking to cut second charge loan application-to-offer times by around five days by offering binding offers with special conditions, including first mortgage Consent.

With UTB understanding that the ability to proceed to offer quickly is often the most important driver for second charge loan applications, the bank believes that this process enhancement will be “significantly beneficial” to brokers and their customers.

It is common for first mortgage lenders to place a restriction at the Land Registry that requires their consent to be provided before a second charge loan can be offered. First mortgage lenders often take time to process and issue these and so the required consent is frequently the only item outstanding, delaying the second charge loan offer.

However, issuing a binding offer without consent, or without a Special Condition for Consent, can technically place the borrower in breach of their first mortgage terms and conditions, potentially creating a poor customer outcome and contravening Consumer Duty, UB says.

From now, all UTB second charge loan binding offers can be issued with special conditions for a range of non-affordability linked requirements. These requirements can then be provided after offer, but before completion.

Feedback from a recent pilot scheme is that this process enhancement can reduce the average application to offer time by around five days.

Examples of where special conditions can be used include:

• First mortgage consent to second charge
• Up-to-date redemption figures
• Bank details for items of debt consolidation
• Deed of Consent for non-dependent residents

Buster Tolfree (pictured), director of mortgages – United Trust Bank said: “We entered the second charge market to shake it up, and nearly 10 years on we’re still innovating and improving to grow the market and help our brokers complete more business.

“Speed to offer and completion is probably the most important success factor in a second charge loan application. Reducing a customer’s wait for a binding offer by five days is a huge reduction and what we have seen in the pilot is that the reduced delay significantly increases the possibility that the loan will complete.

“Both we and brokers waste less time on abandoned cases and are more productive and profitable as a result. And customers get their money quickly to crack on with their home improvements or alleviate their debt worries. It’s a real win-win-win.”