"As the sector grows brokers are constantly having to search for different criteria including, as we’ve seen, where lenders will lend"
Regional lending appeared in the top five criteria searches for both equity release and self-build for the first time in April, according to the latest data from Knowledge Bank.
Its criteria search figures show that equity release criteria sourcing had a shake up last month with a completely new set of criteria making up the top five most popular search categories. Taking the top spot for the first time was the search for lenders who offer ‘medically enhanced lifetime mortgages’. Lenders who offer mortgages on properties in Wales and those who offer a ‘no negative equity guarantee’ made up the top three searches in this sector.
The self-build sector continues the regional aspect to April's results with lending in Scotland the most searched for criteria, followed as usual by lenders offering the highest LTVs.
In the residential sector, April is the third time in the past four months that Help to Buy has appeared in the top five. 'Maximum age at end of term' and 'self employed with one years accounts' completed the top three searches.
In the bridging sector, searches for second charge loans made a first appearance in the top five, while ‘regulated bridging’ remained at the top for the sixth month out of the eleven the tracker has been running. Interestingly ‘minimum loan to value’ featured in the top five of both the bridging and commercial categories.
Nicola Firth, CEO of Knowledge Bank, said: “The criteria index shows us the challenges that brokers are facing in placing cases and how important it is to sort the wheat from the chaff. It is so frustrating for brokers to approach a lender on behalf of their customer thinking that they will be accepted on a product to find that they fall outside of criteria. Equity release is a good example of this; as the sector grows brokers are constantly having to search for different criteria including, as we’ve seen, where lenders will lend. With the scale and frequency of criteria changes in the market it is simply impossible for brokers to keep pace without a system to support them.
“It is also interesting to note the continuing popularity of the Help to Buy scheme and whether this will be affected now the first batch of recipients of this scheme start coming to the end of their five-year grace period and start to repay the loan to the government. There has already been some publicity over the extent and reaction to a possible payment shock for borrowers and so I will be curious to see if brokers continue to seek out these loans with the same vigour.”