Knowledge Bank’s Criteria Activity Tracker has revealed the top five, most searched criteria by brokers during December with maximum borrowing high on the agenda for four categories out of eight.
In the last month of 2018 broker activity remained high and although December is traditionally a slower business month, there was little or no let-up in brokers searching for a home for their clients’ mortgage requirements.
Knowledge Bank now contains over 80,000 pieces of criteria from more than 150 lenders and the index reveals the searches brokers perform prior to mortgage product sourcing. This enables brokers to whittle down the lenders that will actually consider their clients unique circumstances avoiding unnecessary effort and delays from failed applications.
Since making its first appearance in November, ‘Help to Buy’ remains in the top five residential searches for the second month running, however ‘capital raising – debt consolidation’ appeared for the first time, perhaps indicating that some borrowers already know that they were over-spending even ahead of Christmas happening and were already planning how they were going to pay for it. Making up the other places in the residential sector are the consistently searched ‘Maximum Loan to Age’ and ‘Self-employed borrowers with one years’ accounts’.
It was all change for the final month of the year for equity release searches. Brokers’ top search when interrogating the Knowledge Bank system was to find lenders who would lend to non-borrowing occupiers. The second most popular search was for lenders who would lend on Grade 2 listed buildings suggesting that there are a number of premium properties coming back onto the market.
Lenders who offer the highest LTV continue to be the top search in the second charge sector indicating that there are a good proportion of people still looking for maximum borrowing. The second most searched for criteria in December was for lenders who would consider applicants classed as all benefits with no earned income which shows the search for additional debt even from people with no earned income, again perhaps indicating that some people are overspending in the run up to Christmas, or perhaps that more people are looking to escape the rental market and buy property instead.
Within the self-build sector, maximum LTV remains the top search for a second month for those looking for self-build mortgages suggesting that borrowers are continuing to stretch their finances to make the self-build dream a reality.
December’s index reveals that regulated bridging was the top search within the bridging sector for the third time in four months. Regulated bridging is of course a loan secured against residential property and this, rather than the commercial sector seems to be driving growth in this market.
Nicola Firth, CEO of Knowledge Bank said, “The year ended largely as it had started with a huge number of searches across the different product areas. During 2018 new lenders entered the market but it was product innovation that really was the stand out change. With interest rates remaining low, lenders continue to compete on criteria in addition to rate which makes it increasingly difficult for a broker to know who will or won’t accept their client. This product growth was coupled over the year with borrowers having increasingly complex property and financial circumstances. On average brokers searched on five individual pieces of criteria for each borrower which shows how essential it is for a system to ensure that cases are not sent to lenders who will inevitably turn them down.”