First open banking pilot goes live for Castlight Financial’s Affordability Passport

Castlight Financial, the Glasgow-based financial capability company, is partnering with Paradigm Mortgage Services and Foundation Home Loans to launch a major pilot of its Affordability Passport, an affordability tool powered by open banking technology, which allows brokers to process mortgages in under 10 minutes.

Foundation Home Loans, a specialist lender, providing 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 recognise and implement the technology which will transform the residential mortgage space.

The Affordability Passport uses open banking technology to provide a platform for prospective borrowers to share their transactional data in real time with a lender.

The passport then uses the world’s most powerful categorisation engine, developed by Castlight Financial, to categorise the prospective borrower’s income and discretionary and non-discretionary expenditure into over 150 different categories. And because the Affordability 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 AML compliance. In fact, a lender doesn’t need to see any paperwork at all as the Affordability Passport provides an unprecedented amount of transactional information on which to base a fast, informed and compliant lending decision.

Martin Leonard, Castlight Financial Chief Operating Officer, said: “We are delighted that Paradigm Mortgage Services and Foundation Home Loans share our vision for transformational change in the mortgage space. This is good news for Foundation Home Loans brokers who 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. And for their customers who won’t have to assemble piles of paperwork and give up three hours of their day to apply for a mortgage. But for Castlight Financial we believe its also good news for the wider mortgage industry as the Affordability Passport, at its very heart, is a tool for ensuring that borrowers borrow safely and lenders lend safely. It’s a tool designed to ensure financial security and that’s a good thing for everyone. We are looking forward to the broker and client feedback which will be an integral element of this important pilot.”

Andrew Ferguson, commercial director, Foundation Home Loans, said: “With the pace of development and opportunity Open Banking delivers, we are adopting Castlight Financial’s new technology to innovate the way we support client cases. Castlight Financial’s system has proven easy to use and upholds our pragmatic and straight-forward approach. We are confident the exclusive offer will prove invaluable to brokers and clients, facilitating faster decision-making and removing the need to chase bank statements. Thanks to our working partnership with Paradigm Mortgage Services, we expect more lenders and distributors to follow suit.”

John Cofield, head of mortgages at Paradigm, said: “We are delighted to be working closely with both Foundation Home Loans and Castlight on this project, where we believe this cutting-edge technology from Castlight will create greater efficiencies and ultimately speed up the mortgage application process for clients and intermediaries alike. Technology remains a common buzz word in the industry, and at Paradigm we are committed to offering advisers access to technology that will benefit both them and their clients. In this initiative, there are tangible benefits and therefore I’m sure it will be positively received by advisers.”