Digital adviser Mortgagegym has plans to launch a consumer-facing search tool in the summer which sidesteps the need for paper-based background checks and pre-qualifies a borrower for a deal.
Mortgagegym, which has partnerships with consumer search engine GoCompare and the LSL Group, which has a broker-driven financial services arm, said this software is the first to assess a consumer on Open Banking, through credit file searches and banks’ internal lending criteria.
Mortgage gym lenders include Barclays, Coventry Building Society, Accord Mortgages, Platform Mortgages (The Co-Operative Bank), Leeds Building Society, The Family Building Society, Aldermore, The West Bromwich, Clydesdale Bank, Skipton Building Society, Natwest and TSB. The company is on-boarding another eight lenders, which will be announced shortly, it said.
The software examines applicants’ day-to-day spending patterns over a 12-month period, matches them to the Experian credit file and compares this to the mortgage scorecards of 65 per cent of the top 20 mortgage lenders in the UK raising the chance of acceptance from 75 to 95 per cent.
The software breaks income and expenditure down into five categories, including regular income, irregular income, necessary committed expenditure like mortgage payments, unnecessary expenditure and lifestyle expenditure, like eating and drinking out.
The adviser software allows applicants to complete their application online in 15 minutes and can now guarantee applicants can afford any mortgages presented to them, it said.
The regulator’s Mortgages Market Study (MMS) paper ,which came out on 26 March, criticised the industry for hindering applicants’ ability to shop around and Iress launched its own eligibility check through Xplan Mortgage last month to help consumers understand the deal they qualify for earlier in the search.
M&S Bank has begun to use Open Banking in its own mortgage application process but MortgageGym said it is the first platform to provide widespread coverage of mortgage providers using this mix of technologies.
John Ingram, co-founder of MortgageGym, said: “Who wants to explain to their mortgage broker why they spent a lot on the high street in one particular month, followed by eating out more than average the next? Our categorisation engine will be able to tell that an engagement ring is a non-recurring discretionary expenditure and, even though the ensuing celebrations may have been prolonged, they were not on-going throughout the year.
“As we all need to be assessed when applying for a mortgage, as it’s a regulatory requirement, who wouldn’t want to forgo the annoying explanations and antiquated form-filling? There will soon be a faster, painless and more accurate way of getting the best possible mortgage deal for you.”
The business was formed in 2016 by entrepreneurs John Ingram and David Vertannes, who were joined by Jeremy Moll, founding director of comparethemarket.com in 2017.