Mortgages shine in Castlight Financial’s open banking pilot
Glasgow-based Castlight Financial is partnering with Paradigm Mortgage Services and Foundation Home Loans to launch a pilot of its affordability tool powered by open banking technology.
Called Affordability Passport, Castlight says it allows brokers to process mortgages in under ten minutes.
Foundation Home Loans, which provides buy-to-let and residential products exclusively through intermediaries, and Paradigm Mortgage Services, a mortgage club open to all directly authorised intermediary firms, are the “first off the blocks” in the UK to implement the technology.
Martin Leonard, Castlight Financial chief operating officer, says brokers “will have access to the kind of insight into a customer’s financial wellbeing that the bank managers of the past used to have – but at the touch of a button”.
He adds that customers “won’t have to assemble piles of paperwork and give up three hours of their day to apply for a mortgage”.
The Affordability Passport provides a platform for prospective borrowers to share their transactional data in real time with a lender.
The passport then uses a categorisation engine, developed by Castlight, to categorise the prospective borrower’s income and discretionary and non-discretionary expenditure into over 150 different categories.
Castlight says because the passport “tells the whole story of the borrower’s transactional history, there is no need for a broker to trawl through bank statements and payslips to ensure anti-money laundering (AML) compliance”.
According to the company, “a lender doesn’t need to see any paperwork at all as the Affordability Passport provides an unprecedented amount of transactional information”.
Castlight adds that it is looking forward to broker and client feedback which will be an “integral element” of this pilot.