The latest Criteria Activity Tracker provided by Knowledge Bank has revealed the most searched criteria by brokers during the month of September.
In the residential sector, brokers’ most popular search was for lenders who would accept self-employed applicants with just one year’s accounts.
Knowledge Bank contains over 70,000 pieces of criteria from over 150 lenders. During September Knowledge Bank also added two new lending types to its system – commercial and bridging, while overseas mortgages have been added with referrals to Simon Conn Overseas Property and Finance Specialist. These are now included in the Criteria Activity Tracker results.
Within buy-to-let this month the focus has shifted to new borrowers, as brokers searching for lenders who will accept first time landlords and first time buyers take the top two spots in the table. With uncertainly around future stock market movement and investment opportunities following Brexit these searches suggest that bricks and mortar may once again be high up the agenda for those looking for a home for their long-term investments.
Bridging appears in the searches for the first time, with the top category searched for being regulated bridging.
The top category in commercial is for semi-commercial properties. Packagers and buy-to-let lenders have reported that there has been a shift recently in landlords moving from straight residential properties to semi commercial in order to avoid the extra stamp duty and other tax burdens that are now associated with residential buy-to-let.
In the overseas category, the top search for is for buy-to-let. Simon Conn said: “Buy-to-let products as we know them, do not generally exist abroad as they do here as foreign lenders do not usually take rental income into account. The top country enquiries at the moment are for France and for Spain. In France people are predominantly looking to buy for lifestyle reasons; in Spain people are typically looking to buy to rent a property out and generate a future income.”
Top five searches performed on Knowledge Bank by brokers during September 2018
| RESIDENTIAL | BUY-TO-LET | SECOND CHARGE | EQUITY RELEASE | |
| 1 | Self Employed – 1 year’s accounts | First time landlord | Income multiple – affordability | Maximum LTV |
| 2 | Maximum age at end of term | First time buyer | Maximum LTV | BTL equity release |
| 3 | Maximum LTV | Lending to Limited Companies | IVAs | Lend in Scotland |
| 4 | Capital raising – debt consolidation | Maximum LTV | Additional borrowing | Early repayment charges |
| 5 | Debt management plans | Requirement to be a Homeowner/Owner occupier | Add broker/adviser fees to loan | Part interest roll up / payment |
| SELF BUILD | BRIDGING | OVERSEAS | COMMERCIAL | |
| 1 | Maximum age at application | Regulated bridging | BTL | Semi-commercial properties |
| 2 | Maximum LTV | Maximum borrowing | Lend in France | Maximum LTV for trading businesses |
| 3 | Contract workers | Maximum LTV | Expatriates | Maximum LTV |
| 4 | Custom Build – maximum LTV | Minimum borrowing / loan amount | Affordability calculator | Commercial owner occupier |
| 5 | Income multiple / affordability | Lend in Scotland | Lend in Spain | Minimum borrowing / loan amount |
Nicola Firth, CEO of Knowledge Bank, said: “Despite an unusually busy August, September still showed a marked increase in search activity in each of the lending categories. Anecdotal feedback revealed that this was driven by borrowers’ unease following the bank base rate rise and uncertainty over what this means for future borrowing.
“This, coupled with new entrants to the lending sector means more products, more criteria and more confusion as to whether borrowers qualify for the loans they are after.
“As a result, there exist tremendous opportunities for brokers to add value for potential borrowers who may not fit, or may not believe they fit, traditional products. This can only be helped by the three new lending categories on Knowledge Bank. Brokers who offer criteria searching can find this pays huge dividends as a quick search of criteria against a client’s circumstances can offer reassurance forapplications while generating opportunities and solutions with new lenders, some brokers may not previously have realised was possible.”