UK: Soft launch credit checks for intermediated mortgage business

Santander has announced that it will begin running soft credit checks for mortgage ‘agreements in principal’ for all applications that come through an intermediary.

The new process will mean that the application of the agreement in principal will not be visible on the applicant’s permanent credit history. This will stop the enquiry from having a negative impact on consumers credit histories and is expected to encourage borrowers to shop around for their mortgage to see what lending options are available to them.

The move could push more consumers to use an intermediary when applying for a mortgage, rather than apply direct. RFi Group data shows that the market is already moving in this direction, with 41% of mortgage holders having used an intermediary in the third quarter of 2017, up from 32% at the beginning of 2017.

The data Santander collects on the credit enquiry will be valid for 60 days, and the search will be visible to the applicant if they request a copy of their credit history.

Santander will perform a full hard credit check (which will be visible in the permanent credit history) once a full mortgage application has been submitted.

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