According to the study, the direct (salary-linked) cost that an adviser or intermediary incurs to prepare or 'package' a mortgage application for a lender is £85. Indirect costs double this figure to £170. Direct costs that the lender bears are estimated at £60, doubling again with indirect costs to £120. Processing costs on both sides per application and - before sales costs - therefore total £290.

Research shows that the huge paper-chase involved in completing and supporting the application with relevant identification, pay slips, fees, bank statements and the like, make the process very lengthy and time consuming. The average mortgage application from case submission to mortgage offer takes at least 7.5 hours (and up to 13 hours) to process. A mortgage application often takes up to 90 days from start to finish.

Also highlighted by the report is that the request for local search information tends to take three weeks and costs the customer an average £86 to obtain through a solicitor from the relevant local authority. If the local council could commit this information to a database and make it available on request via the Internet, the cost and time involved could be reduced to a fraction of what it is today, says the software provider.

Focus argues that all parties involved need to work harder to integrate processes and make them electronic if the Government is to realise its target of making it easier and quicker to buy a mortgage.

Nick Berry, mortgage business consultant at Focus Solutions, says: "With the threat of increased and compulsory regulation and a larger compliance burden, there is a real risk that high quality, independent financial advisers will be driven away from offering advice around a mortgage application because the work is already so time consuming and unprofitable. The challenge is for all parties to embrace Internet-based technology to find these badly needed efficiencies."