Document Collection Delays Kill 1 in 5 Mortgage Deals Before They Reach Settlement

I watched a mortgage broker in Melbourne lose a $1.2 million loan deal because of a bank statement. Not a complicated credit issue. Not a valuation problem. A bank statement.

The borrower had provided everything — payslips, tax returns, ID, employment letter, savings evidence. Everything except the transaction account statements from their secondary bank account. The broker asked for them on day one. The borrower said they’d send them “this week.” A week passed. The broker sent a reminder. The borrower apologised and said they’d been busy. Another week. Another reminder. By the time the statements arrived, the payslips had expired (older than 30 days) and needed to be re-collected. The lender’s assessment was delayed by three weeks. The vendor lost patience and accepted a cash offer from another buyer.

Three weeks of delays. A $1.2 million sale lost. Approximately $6,600 in broker commission gone. Because nobody automated the follow-up on a missing bank statement.

The Document Collection Time Drain

The document collection problem in mortgage broking is deceptively straightforward. Every broker knows what documents are needed. Every borrower is told what to provide. Yet the gap between “documents requested” and “documents received” consistently remains the single largest bottleneck in the loan processing pipeline.

The scale of the problem is significant. A broker processing 10 loan applications per month, each requiring an average of 16 documents, is managing 160 individual document items. Each one needs to be requested, tracked, received, verified for completeness, checked for currency, and filed. At any given time, 30-40% of those documents are outstanding — meaning the broker is simultaneously chasing 50-60 missing items across 10 different applications.

Why Borrowers Don’t Send Their Documents

Understanding why borrowers delay document submission is essential to solving the problem. It’s rarely malicious or intentional. The causes are predictable:

Overwhelming initial request. The borrower receives an email listing 14-18 required documents. The list feels massive. They don’t have all the documents readily available. Rather than sending what they have now and the rest later, they do nothing — waiting until they can complete the full list, which never happens.

Unclear requirements. “Bank statements for all accounts for the past 3 months” sounds simple to a broker. To a borrower, it raises questions: Does that include the savings account they never use? Does it include their offset account? Does a CSV download from internet banking count, or does the lender need a PDF statement? Do they need to redact anything?

Document access friction. Many borrowers don’t know how to download formal bank statements (not just transaction histories) from their internet banking. They don’t know where to find their ATO Notice of Assessment. They can’t remember the login for their super fund’s portal. Each document requires effort to locate, and the borrower puts it off.

Life gets in the way. Borrowers are buying a home during some of the busiest periods of their lives. They’re working full-time, managing family obligations, attending property inspections, and dealing with the stress of a major financial decision. Gathering documents drops to the bottom of the priority list.

The Phased Collection Approach

The brokers who get documents fastest don’t send a single massive request. They break the collection into phases based on document accessibility:

Phase 1: Immediate (Day 1)

Documents the borrower should have at their fingertips:

• Photo ID (drivers licence, passport)
• Most recent payslip
• Employment letter (if they have one from a recent salary review)

These are quick wins. Getting 3-4 documents submitted on day one creates momentum and reduces the perceived burden of the remaining list.

Phase 2: Within 3 Days

Documents that require logging into a portal or making a request:

• Bank statements (with specific instructions: “Log into [bank name] internet banking, go to Statements, select PDF format for the last 3 months”)
• Existing loan statements
• Credit card statements
• Super fund statement

Phase 3: Within 7 Days

Documents that may require contacting a third party:

• Tax returns and ATO Notice of Assessment (with MyGov instructions)
• Employment letter (if they need to request one from HR)
• Rental income evidence (from property manager)
• Self-employed: accountant-prepared financial statements

This phased approach reduces the initial overwhelm and creates a natural follow-up cadence. Instead of one reminder saying “you still owe me 12 documents,” the broker sends targeted reminders: “Just waiting on your bank statements — here’s exactly how to download them.”

The Document Expiry Time Bomb

Here’s a scenario that drives brokers insane: a borrower submits their payslip on day one of the application. The application takes 35 days to reach assessment. The lender rejects the payslip because it’s now more than 30 days old. The broker has to go back to the borrower, request a new payslip, and wait — again — while the application sits in limbo.

Document expiry is a hidden cause of processing delays that many brokers don’t track until it’s too late. The expiry windows vary by document type:

• Payslips: 30 days from date of issue
• Bank statements: Must cover the most recent 90 days (so statements downloaded on day one may not cover the assessment date if the application takes longer than expected)
• Employment letters: 30 days from date of issue
• ATO Notice of Assessment: Must be from the most recent financial year
• Business financials: Must be from the most recent financial year

A document tracking system that monitors expiry dates and sends proactive alerts — “Borrower X’s payslip will expire in 5 days; request a fresh copy now” — prevents the frustrating cycle of re-collection that adds weeks to the application timeline.

The Lender-Specific Complication

Different lenders have different documentation requirements, and these variations catch brokers off guard. Lender A accepts three months of bank statement transactions downloaded from internet banking. Lender B requires formal stamped bank statements on letterhead. Lender C wants the borrower to log into their banking portal and take a screenshot showing the account holder name and BSB.

When the broker doesn’t know which lender they’ll submit to until after the fact find and product comparison, they face a choice: collect documents to the strictest standard (which means asking borrowers for more than they might need) or collect to the minimum standard and risk re-collection if the application goes to a stricter lender.

The practical solution is to maintain lender-specific document requirement notes in the tracking system and align the collection process with the intended lender as early as possible. Once the target lender is identified during the fact find, the document checklist should automatically adjust to that lender’s specific requirements.

Measuring Document Collection Performance

Track these metrics to identify bottlenecks and improve over time:

• Average days to complete documentation: From initial request to all documents received and verified. Target: under 10 days.
• Document re-collection rate: How often documents need to be re-requested due to expiry or format issues. Target: under 10%.
• Reminder-to-submission ratio: How many reminders, on average, before each document is received. If it’s consistently above 2, your initial instructions need improvement.
• Application-ready rate: What percentage of applications have complete, current documentation at time of submission. Target: above 90%.
• Settlement delay attribution: When settlements are delayed, track whether documentation was the cause. This data justifies the investment in automation.

The document collection process is unglamorous. Nobody becomes a mortgage broker because they love chasing bank statements. But it is the operational backbone that determines whether a deal settles in 28 days or 58 days — and whether the borrower’s experience is smooth professionalism or frustrated chaos. Automating the chase gives brokers back 6-8 hours per week to do what they actually got into this business to do: help people buy homes.