Knowledge Bank latest tracker has revealed that advisers are working with a “significant” number of borrowers who have recently started a new role.
There was an estimated 1.32m people re-joining the jobs market in October as a result of the end of the furlough scheme, with brokers in the residential arena searching for ‘time in employment’ in numbers in October.
Alongside people in new jobs, brokers also increased the number of searches for ‘self-employed – one year’s accounts’, suggesting that brokers are also working with a substantial number of clients who have set up their own businesses recently.
Meanwhile, Knowledge Bank says borrowers were stretching finances in October with ‘income multiple used for affordability assessment’ being the second-most searched term in October. ‘Missed or late payments’ also featured in the residential market, and ‘capital raising for debt consolidation’ and ‘mortgage or secured loan arrears or defaults’ were amongst the most-searched in the second charge market.
In the bridging market, ‘minimum loan amount’ was the most-searched term in October. The criteria firm says that some of these loans may be connected to the recent trend of refurbishing a property, then renting it out. Some landlords are looking to buy cheaper properties that need a renovation via a bridging loan, then exiting onto a buy-to-let mortgage.
In contrast, there were also some looking to make significant changes to properties, with ‘heavy refurbishment’ and ‘maximum loan to value’ also featuring in the five most-searched terms.
‘Regulated bridging’ was the second most-searched term in October, showing alongside renovations to commercial properties, borrowers were also using bridging finance for properties they, or their family will use.
With rising house prices, more people may be exploring the option of building their own home. In the self-build sector, ‘minimum loan amount’ featured in the most-searched terms for the first-time since June. In addition, ‘maximum loan to value’ and ‘maximum loan to cost’ occupied the first and second most-searched spots in the self-build sector.
Matthew Corker, (pictured) operations director at Knowledge Bank, said: “Our criteria database is the most comprehensive on the market, and our analysis shows lenders have been reviewing a range of criteria recently, particularly in areas where brokers are searching.
“For instance, with the end of furlough, brokers are working with a number of clients who have started new roles, and lenders have reacted, loosening criteria for borrowers starting new jobs.
“This follows a raft of criteria changes related to self-employed borrowers. By reducing restrictions imposed on freelancer applicants, lenders demonstrated that overall, they are confident that the economy is returning to normal.
“There are still a huge number of vacancies across sectors, and there will undoubtably be more new starters in the coming months, so this may well be an area that lenders continue to look at.”
