The mortgage process in the UK & Ireland has several defining characteristics. One is that it’s highly – and increasingly – intermediated: Mintel estimates that brokers and intermediaries handled over 80% of new sales in 2024, up from around 55% a decade earlier. It’s also heavily dependent on manual interventions, boosting cost and hampering efficiency across the value chain. And there’s limited differentiation between lenders, with their brands having little influence on customers’ product choices.
The effects are all too clear. For example, UK Finance says the average mortgage journey takes 45 days – and 89% of customers find the mortgage application as stressful as buying the home itself. These metrics partly reflect the fact that, despite the creation of digital front-ends for customers, 40% of the mortgage journey still requires human intervention.
But this situation can change. And the potential for it to do so is growing rapidly, spurred by the advent of new technologies such as generative and agentic AI. These transformative capabilities are opening up a pathway to reinvent UK mortgage lending at every level – from the lender to the broker to the customer to the overall ecosystem – by introducing higher commonality, automation and efficiency.
Three themes shaping today’s mortgage market
To help explain how this can come about, let’s start with some context. There are three overarching themes at play in the UK mortgage industry.
First, the mortgage product itself has been subject to increasing commoditization. With brokers dominating origination and distribution, lenders are often effectively anonymous — with most customers just looking for the keenest rate, and largely disinterested in who’s funding their mortgage and taking on the related risk.
This low awareness is a particular challenge for many high-street lenders, where mortgages constitute a big proportion of their lending book. The tenuous link with their customers — together with the commoditization of the anchor mortgage product — undermines customer “stickiness”, making it harder to cross-sell other offerings like insurance and savings accounts. And when the servicing cycle for a mortgage comes around at the end of the tenure, it’s still the broker who primarily owns the customer and acts as their touchpoint.
The second — related — theme in the UK mortgage market is customer experience (CX). For both banks and brokers, the key to creating a stickier relationship with the customer is leaving them with a positive customer experience of every interaction — a fact that makes CX the vital battleground for customers’ loyalty. Winning here means making things friction-free: easier, less onerous and more tailored to the individual customer at every stage. But it’s a space that’s crowded with players, as lenders, brokers and comparison sites vie to gain mindshare and market share.
The third driver of market change? Inevitably, it’s technology. The potential of data, automation and AI — from predictive to generative to agentic — to help streamline processes, generate efficiencies and reduce operating costs is well-known. And the effects are already being felt: according to data from fee-free mortgage broker YesCanDo Money, average application to submission to approval time across all the mortgages it organised in 2024 was 10 days — representing a 29% improvement on the previous year, on top of a 40% reduction from 2022 to 2023.
These impressive gains are being driven by leveraging digital technologies, mobile banking, open banking and an enhanced ability to share data across the ecosystem to drive sleeker and more integrated customer journeys.
But this is likely to be just the start. AI and agentification represent a huge opportunity to reimagine the mortgage ecosystem of the future by shifting common and commoditized functions to shared-service utilities. This would enable lenders (and potentially intermediaries) to focus on product and experience differentiation through hyper-automation, personalization and orchestration.
How a utility model could boost differentiation
Across the mortgage sale and origination process, there are many steps that customers have to undertake. These include providing proof of address, identity, salary, credit scores, utility bills, and more.
Most of these information elements are agnostic of broker or lender. Yet each provider usually asks for them in their own bespoke form before putting them through the same process. It’s repetitive, duplicative, and crying out for standardization via a shared industry utility and data repository that all participants can access and use.
The industry in the UK is not ready for this yet because it requires agreement across a diverse set of stakeholders. It’s a model that’s closer to realization in some other countries because of supporting factors like universal digital ID and a government-led digital spine.
One good example of a utility approach in action is Denmark, which has built one of the world’s most sophisticated shared mortgage infrastructures, boosting efficiency throughout the process. Another is India, where the government has championed a country-wide digital spine, the so called, ‘India-stack’, establishing standards across digital identity and payments, and enabling interoperability and innovation.
From a UK perspective, a utility approach to customers’ core data would create significant synergies in origination and distribution, driving down total cost of ownership for all parties. But it also stands to bring a further major benefit: enabling lenders to stop being bogged down in processes that can and should be standardized — and freeing them up to focus on unique differentiators including product features, relationship benefits and CX.
To do this, lenders will need to think through their true differentiators, clarifying and articulating why — beyond rates — a customer should choose their mortgage over a competitor’s. From high-street giants to tier-two banks to regional building societies, the basis of differentiation will differ in every case. But by offloading to an industry utility the commoditized grunt-work of activities like managing scanned passports and salary slips, lenders will be able to devote more time and resources to understanding what customers want and providing an experience that delivers it.
Joining the agentic AI era
The time is right for lenders and industry participants to define and usher in the future of the mortgage sales and onboarding journey. AI and agentification offer an unprecedented opportunity to reimagine and reinvent customer journeys, unencumbered by the legacy processes and approaches of the past.
Across industries, there are promising use cases where agentification has targeted previously insurmountable friction-prone customer experiences and reimagined them entirely. Specifically, AI and agentification have targeted industry niches that have thrived on customer friction to create business models predicated on commission-based intermediation services.
Mortgage industry participants should collaborate to embrace the promise of this technology to create a utility shared service that streamlines and automates much of the data gathering and validation required for underwriting and onboarding.
Creating the mortgage provider of the future isn’t about taking the next incremental step. It means thinking proudly about the customer proposition and embracing the era of agentification to disrupt your own business before others disrupt it for you. The time to start? Today.
