All change in the latest broker criteria search database

Knowledge Bank’s criteria index for February has revealed some surprise results, with some sectors experiencing unprecedented change.

It was all change in the equity release sector, which saw an all-new top five most popular searches last month – the first time in over 12 months. The most popular search was made by brokers seeking the minimum age of the applicant the lenders would accept. In second place was brokers searching for lenders offering an equity release inheritance protection guarantee, which appeared in the top five for the first time.

The residential sector offers a slightly more balanced picture, with brokers looking for lenders offering the maximum age at the end of the term the most popular search in this category once again. New additions to the top five include the search for lenders allowing joint borrowers for a sole proprietor and a search on income multiples for affordability assessment.

Meanwhile, second charge loans saw two new additions to their most popular searches last month. These were for lenders allowing CCJs registered in the past three years and an existing secured loan or mortgage arrears or defaults, which suggests a worsening arrears picture within the secured loan sector.

It was a far more relaxed picture in the buy-to-let category, with four of the top five searches consistent with the previous month. A new addition to popular searches was for first-time buyers – an encouraging sign that borrowers are still interested in buy-to-let as an investment opportunity.

The commercial sector also witnessed consistent results with the previous month. Brokers’ clients are continuing to task them to find the maximum loan-to-value (LTV) permitted and also to accept semi-commercial properties.

Last month saw changes to the most common searches in the bridging category, with development finance coming in third. The search by brokers for lenders offering development finance hasn’t been in the top five searches since November 2019, and Knowledge Bank says they may be a sub-set of this sector to watch.

“February really threw up some surprising results, most notably in the equity release sector where it was all change,” says Matthew Corker, lender relationship manager from Knowledge Bank.

“The extent and speed of change in the criteria needs of borrowers from month-to-month shows just how essential it is for brokers and lenders to adapt to changing demands. We work with lenders every day to help them use this data to evaluate the market and adapt their criteria accordingly.”

He concludes: “Because criteria searches happen at the onset of the advice process, prior to any product sourcing, it presents lenders with a unique opportunity to adapt to a changing market and drives change and innovation.”