Reaping the benefits of Open Banking in Buy-to-Let: how it works from an underwriter’s perspective
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LendInvest has been an early adopter of Open Banking in the Buy-to-Let process, using its potential to offer faster deals. Our Underwriting Team Leader, Tom Steer, talks through how Open Banking is working for the underwriting team to make Buy-to-Let deals faster and simpler for brokers and their clients.
How long have you been using Open Banking in the BTL process?
We have used open banking within the business for over a year now but have really started to reap the benefits of the system since our transition to new provider, Credit Kudos.
How has it evolved since you’ve been using it?
The original system we used when first introducing it to the business was not very user friendly, we have since moved over to Credit Kudos who have a very appealing interface that is very easy to use and view the information. The signup process for an individual is a few simple clicks and speeds up the process instead of requesting bank statements and other documents from the applicant.
In what ways does it change/simplify what you do?
We can use open banking to do a number of things that using a regular bank statement would make quite challenging. We are able to verify income – as well as mortgage payment history – and deposit queries. This is on top of the other standards checks it is able to simplify and streamline for the broker.
What are the broker/borrower benefits?
For the brokers we’re able to send out a simple link to the client which will satisfy the majority of packaging requirements, instead of requesting a list of documents, which can be both time consuming and frustrating to produce for the borrower.
It can also allow ourselves to answer any questions we may have about the application quickly, which will prevent the back and forth between lender and broker and result in a quicker speed to offer
What do you think are some of the barriers to brokers and borrowers adopting it?
With any new piece of technology there is a hesitancy to utilise it in a very historically manual process, because it would represent a huge shift away from the norm for brokers. The technology itself is a game changer in the mortgage market and we are starting to see the benefits of using the system for speed and cutting out back-and-forth questions