Latest / Best of Business / Michelle Isemonger: loan market advisor on the backlog impacting loan requests

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Michelle Isemonger: loan market advisor on the backlog impacting loan requests · Best of Business

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  Speaker 2: Borrowers are experiencing delays of up to five weeks as
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  Speaker 2: banks work to clear a backlog of lending requests. The
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  Speaker 2: process typically takes just five days, but an influx of
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  Speaker 2: applications when interest rates dropped last year has created apparently
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  Speaker 2: a large backlog. Advisor at Loan Market, Michelle is among
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  Speaker 2: it is with us and she's here this evening. Good evening, Hi,
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  Speaker 2: how are you good? Thanks? Michelle? Is this usual? Is
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  Speaker 2: this normal? When interest rates drop we start to see
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  Speaker 2: backlogs at the banks.
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  Speaker 3: Definitely common when interest rates start to decrease. Of course,
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  Speaker 3: we saw the ocr drop right before Christmas, so that's
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  Speaker 3: usually a crunch time regardless. But yeah, it was definitely
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  Speaker 3: a large backlog, but the banks have managed to clear those.
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  Speaker 3: We are seeing now the standard five working days for applications,
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  Speaker 3: which is great.
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  Speaker 2: Oh that's good. Was it maybe just a Christmas thing?
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  Speaker 2: Because I imagine a lot of people want to get
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  Speaker 2: their ducts in order before Christmas? Do you know, do
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  Speaker 2: you typically see an increase in applications then too?
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  Speaker 3: Yeah, definitely, of course, the OCR decreases absolutely accelerated that,
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  Speaker 3: so you know, everyone was wanting to do something prior
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  Speaker 3: to Christmas and also kind of you know, take the
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  Speaker 3: box in terms of achieving that goal before the year ended.
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  Speaker 3: But there's a mix of things that caused such a
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  Speaker 3: large backlog before Christmas. And I think the main thing
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  Speaker 3: would be, obviously, as I said, the o CR change,
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  Speaker 3: but as well as a change in the regulations in
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  Speaker 3: terms of now we need to provide so much more
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  Speaker 3: information to the banks and applications. So the biggest backlog
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  Speaker 3: is actually the reworked que within the banks. So those
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  Speaker 3: are applications that haven't been submitted correctly, or there's information missing,
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  Speaker 3: or they're just more complex applications. That of course causes
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  Speaker 3: a lot of delay when we needed to go back
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  Speaker 3: to the clients or the banks needing more information. And
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  Speaker 3: so I think that that that's the biggest cause that
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  Speaker 3: we saw last year.
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  Speaker 2: Which banks are the quickest, good question.
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  Speaker 3: It really depends on the type of application we see.
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  Speaker 3: Most banks be very tran system at the moment, as
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  Speaker 3: I said, where our clients were estimating between five to
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  Speaker 3: seven working days, so they're all very equal at the moment.
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  Speaker 3: Which is really good.
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  Speaker 2: But typically is this, is there a bank you don't
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  Speaker 2: want to go through ASB they take ages?
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  Speaker 3: Oh no, god, not at all. It's as I said,
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  Speaker 3: we advise. Banks are based on what the client's doing.
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  Speaker 3: So some banks specialized for first on buyers, you know,
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  Speaker 3: some banks are great for business leanning. So it really
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  Speaker 3: depends and that's why a lot of people work with
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  Speaker 3: more good advisors to get that talent advice that's going
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  Speaker 3: to really stoop what they're doing.
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  Speaker 2: Michelle, thank you very much for that. Good to know
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  Speaker 2: that it's all back in order now. Michelle Eismonger with us,
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  Speaker 2: She's the loan market Advisor.
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