Homebuyers and real estate agents frustrated as loan processing hinders sales

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PROCESSING TIME for housing loan applications stay with several banks in Finland for a long time.

YLE on Monday reported that not all banks have been able to successfully respond to the increase in demand in the real estate sector, which has led to an increase in waiting times for loan and purchase negotiations by up to four weeks.

The situation is difficult especially in the region of the capital and in other agglomerations, in spite of the weekend campaigns organized by certain banks.

“Sales in the capital region had to be made as far as Tampere or Vääksy, because the banks in Helsinki could not give a suitable appointment until more than a month after the agreed date”, Saara Murtovaara, the COO of Bo LKV, told YLE.

Delays in the application process prevent buyers from making binding offers, putting them at a disadvantage compared to buyers who negotiated the details of their loans earlier. The situation is difficult because quick reactions and decision-making are often necessary in the real estate market.

The issue has been discussed in the industry throughout the spring, according to Annukka Mickelsson, the managing director of the Fédération des Agences Immobilières.

“Naturally, it’s aggravating to lose your dream home to something like this,” she said.

Mickelsson pointed out that the digitalization push caused by the coronavirus epidemic and the evolution of information systems have compounded the problem of banks that have not kept up with development.

The Bank of Finland reported last week that the number of real estate transaction agreements increased by more than a third (34%) year-on-year between January and May. Kirsi Valimaki, the bank manager of OP Tampere, reminded YLE that part of the increase is attributable to the slowdown experienced at the start of the epidemic.

“These two years are not brothers. A year ago, we cleared a backlog of reimbursement holiday requests; now is the time for traffic jams in new home loan applications,” she said.

Aleksi Teivainen – HT

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