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‘All change’ in broker criteria searches in the run-up to 2020

There is evidence of continuing volatility in the mortgage market, with different criteria searches among brokers reaching the top five, according to the latest analysis from Knowledge Bank.

The criteria search specialist found there was no let-up for some brokers during the festive period. In fact, Knowledge Bank was accessed 11 times on New Year’s Day, 66 times on New Year’s Eve, six times on Boxing Day and once on Christmas Day itself.

Interestingly, for the third month in a row, none of the previous top five criteria searches featured this time around, and the leading search – ‘non-standard construction’ – had been in the top five only twice previously.

In the residential market, ‘Help to Buy Equity Loan Scheme’ appeared in the top five for the first time since August. From March 2021, the scheme will only be available to first-time buyers and will have tight regional price caps.

Another factor in the residential market is the clear shift towards mortgages for older borrowers, with searches both for ‘maximum age at end of term’ and ‘maximum age at application’ appearing in the top three.

The searches for ‘interest only’ and the ‘Help to Buy Equity Loan Scheme’ mentioned above show that affordability is a growing issue for people wanting to get on the housing ladder.

In the buy-to-let market, there was a first-time entry for ‘day one remortgage’, which might represent people raising finance for renovation. The second most frequent search in this category – ‘lending to trustees’ – had also never previously featured in the top five.

Meanwhile, in the self-build market, a surprising top search was for ‘applicants paid in a foreign currency’, also a brand new entrant to the top five, which could reflect the increasing interest in this market from overseas investors looking to get a foothold in the UK property market.

“December has once again seen a huge amount of change in the criteria brokers are searching for,” Nicola Firth, chief executive officer of Knowledge Bank, comments.

“The equity release market seems to be particularly unpredictable but there have been a number of surprising new entries and re-entries across every sector of the market. The searches in residential reflect just how challenging the mortgage market remains for people wanting to get onto the housing ladder and those who will still be paying off mortgages, potentially well into retirement.”

She says brokers really need to stay on their toes to keep up with the hundreds of changes to lenders’ criteria.

“Brokers should make it a New Year’s resolution to make sure they are using all the tools available to them in order to free up some of their own time whilst also ensuring that they give their clients the best advice possible to find them the best lender for their needs,” she concludes.

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