"After a busy start to the year, this data suggests that homemovers, in particular, have taken advantage of strong competition between lenders and a fast expanding range of competitive products."
The IMLA research shows that overall, 55% of enquiries progressed to an agreement in principle, with the highest rate reported by intermediaries dealing with remortgages and specialist loans (59%). Those focused on FTBs saw the fewest initial enquiries (51%) progress any further.
However 2014 and 2015 saw FTB activity make a slower start to the year than homemover and remortgage activity, before registering the fastest growth of all three segments from Q1 to Q2. FTB loans via intermediaries are already up 15% year-on-year.
Overall, almost seven in ten (69%) AIPs in Q1 then progressed to an application, rising to 72% among firms handling homemover and remortgage cases.
More than three in four (76%) applications received an offer, and the same percentage of offers (76%) resulted in a completion. In each case, intermediaries dealing with homemover cases reported the highest conversion rates (80%).
Comparing types of firm, members of AR firms reported a 78% progress rate at both stages, compared with 73% among DA businesses.
According to brokers, lender decisions to decline an application in Q1 accounted for fewer than three in ten (28%) drop-outs between AIP and completion stage, notwithstanding the option for those affected to keep progressing their application via another lender.
Intermediaries dealing with first-time buyers reported a lower rate of lender declines (29%) than those dealing with homemovers (31%) or applicants for specialist loans (33%).
Peter Williams, Executive Director of IMLA, commented: “Using an intermediary has become ever more established as the most common way to access mortgage finance in the UK. After a busy start to the year, this data suggests that homemovers, in particular, have taken advantage of strong competition between lenders and a fast expanding range of competitive products.
“The first time buyer market typically picks up pace in Q2, although April’s stamp duty reforms have clearly disrupted normal patterns and will have a lingering effect on the supply of property. Credit conditions are just one of many factors impacting first time buyers’ journey from enquiry to completion, and the EU referendum adds another unknown into the mix for Q2 which won’t go unnoticed in terms of intermediary confidence and consumer behaviour.
“In the meantime, despite the rush to beat the stamp duty reforms, our analysis also suggests there was no opening of the floodgates for BTL mortgages, with the progress of BTL applications remaining broadly in line with market norms. This suggests that standards of borrower assessment have held up well, despite the pressure of extra demand."
