Legal & General’s SmartrCriteria tool recorded a -32% decrease in furlough friendly mortgage searches on behalf of homeowners that want to remortgage.
This is the second consecutive monthly drop, after a 40% reduction between March and April. The volumes of searches for mortgages suitable for borrowers with unsatisfied defaults also continued to reduce (-2%) and demand for mortgages for borrowers with unsecured arrears remained stable, month-on-month.
Overall search activity has also continued to return to more normal levels, having fallen 20% in May from its March peak.
Alongside signs that demand for mortgages designed for complex borrowers has begun to reduce, Legal & General Mortgage Club’s SmartrCriteria tool also tracked a growing trend for rapid remortgaging. Searches on behalf of homeowners that wanted to remortgage after less than six months jumped by 40%.
In the wake of record house price growth, SmartrCriteria also recorded a significant increase in searches for capital raising mortgages. Demand for these products jumped 26% between April and May.
Searches for visa-friendly mortgages remained atop of adviser activity by volume, suggesting interest in UK property from overseas buyers remains strong
Meanwhile, mortgages suited to borrowers with satisfied defaults remained in the top three most sought after criteria in a sign that the mass use of mortgage payment deferrals is having a lasting impact of mortgage purchase trends
Clare Beardmore, head of mortgage transformation and operations at Legal & General Mortgage Club, said: “The mortgage market has been on a rollercoaster ride in recent months with demand reaching unprecedented levels between January and March. However, we are now seeing the early signs that things may be returning to ‘normal’ with search activity more closely resembling pre-pandemic conditions.
“Of course, many are still likely to feel the financial consequences of the crisis for some time yet and the key for mortgage borrowers is to continue seeking independent mortgage advice when it comes time to find a new mortgage. Advisers, with the support of cutting-edge technology, have so far done an excellent job finding the right options for homeowners across the country and we can expect this trend to continue with the many thousands needing to refinance before the end of the year.”
