Gen H's tool to address credit search transparency has been hailed as a “mortgage market game-changer” by brokers.
Gen H’s tool works by sharing any discrepancies identified during the soft credit search with brokers when a decision in principle is submitted.
Brooklyns Financial director, Harps Garcha said this increased transparency and better disclosure practices will cut down on delays and confusion in the mortgage process.
“If other lenders follow suit, it could make things smoother and quicker for the entire mortgage industry,” she added.
Yellow Brick Mortgages managing director, Stephen Perkins, added the tool is an example of a modern solution to an age-old problem.
“Brokers key applications based on the credit commitments disclosed by clients, and even if they ask for a credit report, these do not always show all accounts,” he explained.
“Then when the lender receives the application they advise it has been declined due to something undeclared.
“The Gen H system of stating the commitments they have found on their search and then asking if these will continue to be paid off, hugely simplifies this process and will lead to much less frustration for borrowers and brokers alike.”
Perkins hopes to see other lenders following this blueprint in the future.
Meanwhile, Staton Mortgages director, Mike Staton, described the announcement as a “victory for common sense and a win for borrowers”.
“I have always struggled to understand why a lender would not disclose the reasons for an adverse credit decline, considering you have provided the lender with all of the required information to process the application.”
A similar sentiment was shared by Release Freedom broker and director, Simon Bridgland, who said the tool represented “common sense underwriting at last.”
He explained that, for years, lenders have “hidden” behind data protection rules as an excuse to not say what’s on file for a client.
“That then leaves us having to stab a guess at what is on someone’s credit file,” he said.
“Not all clients know or understand what will show up, especially if there has been a family breakdown.”
Additionally, Contractor Mortgage Services director, Ken James, said: “Finally we have a lender who is willing to pull back the curtain to reveal what was there all along, namely answers.
“As brokers, we have long been asking for this, but our voices have fallen on deaf ears. Lenders like Gen H are really starting to shake up traditional lending practices.”
tom.dunstan@ft.com
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