Brokers are searching for ‘maximum loan to value (LTV)’ in large numbers, according to Knowledge Bank’s latest mortgage criteria tracker. The interest is coming from various sectors, with ‘maximum LTV’ either the most, or second most-searched across the second charge, equity release, self-build, bridging and commercial mortgage markets.
Similarly, ‘maximum loan to value’ and ‘maximum loan to cost’ are amongst the most-searched terms in the self-build sector.
In the second charge sector there was a growth in the number of brokers searching for ‘capital raising for home improvements’.
For the second month in a row ‘barn conversion’ has registered significant interest from brokers. Knowledge Bank said this may be linked to the shift away from city living, with rural areas registering significant interest since the pandemic began.
In the residential market, the second and third most-searched terms related to economic hardship. Brokers are still searching for ‘missed or late payments’ and ‘defaults – registered in the last three years.
Knowledge Bank believes that searches for ‘Maximum age at end of term’ and ‘income multiple used for affordability assessment’ also make it clear that rising house-prices are stretching finances for many in the residential market.
Matthew Corker, operations director at Knowledge Bank, said: “Although those in the residential market are definitely impacted by the spike in property prices, maximum LTV is less of an issue than in other sectors. Residential 95% LTV mortgages have returned in force, however the dramatic increase in property prices is impacting affordability, and many borrowers are looking to stretch terms to lower monthly repayments leading to the rise in searches for just how old someone can be at the end of their mortgage term.
“While there have been record numbers of house-moves in the past few months, there are also a significant number of people looking to redevelop existing properties, and even build new ones. The pandemic has changed the way many of us view our home, and also the use of office space and commercial property, and these changes are resulting in renovations and redevelopments.
“Our mortgage lending criteria database is the largest and most up-to-date in the UK, and the monthly searches give a strong indication of the mortgages that lenders will issue over the next few months. The latest results from our criteria tracker suggests builders will be busy in the coming months, with renovation and building projects of high interest.”