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04 April 2019

In the week that the Equity Release Council’s Spring 2019 Market Report announced a seventh consecutive annual increase for the sector, the Knowledge Bank criteria activity tracker highlights a shift in broker searches regarding equity release. Whilst searches for lenders that allow houses of multiple occupation come into the top five for the first time in the buy-to-let sector.

The latest criteria activity tracker from Knowledge Bank has revealed brokers’ top searches in March 2019. As the largest database of mortgage lending criteria held anywhere in the UK; Knowledge Bank’s monthly criteria index reveals the searches brokers perform prior to mortgage product sourcing.

Tenure becomes the most searched criteria category within Equity Release for the first time in the criteria index. Interestingly the top searches within equity release have shifted in recent months from factors affecting the loan to considerations relating to the property itself. Brokers have also been interrogating the data for lenders who will consider timber and non-standard construction in addition to properties with an annex or outbuildings.

Within the Buy-to-Let sector, searches for lenders who will allow first time landlords once again takes the top spot and, with continuing uncertainty surrounding alternative investment choices, bricks and mortar seems to be offering an attractive option. Additionally, within buy-to-let searches for lenders that allow houses of multiple occupation (HMO) breaks into the top five for the first time. This search has been featured in the top ten multiple times but has not been one of the top five searches since we started the index in July 2018. Anecdotal evidence suggests that changes to rules surrounding HMOs is leading brokers to delve deeper into this area.

Residential loan searches in March continue to relate to the needs of older borrowers with three out of the top five categories relating to a borrowers age. The most popular searches performed by mortgage brokers in March included those for lenders who offered the most generous criteria regarding the maximum age at the end of the mortgage term.

The full list of top searches in the eight available categories is below:

Top five searches performed by brokers on Knowledge Bank during March 2019:

	RESIDENTIAL	BUY-TO-LET	SECOND CHARGE	EQUITY RELEASE
1	Maximum Age at End of Term	First Time Landlord	Maximum Loan to Value	Tenure
2	Self Employed - 1 Years Accounts	Lending to Limited Companies	Capital Raising for Debt Consolidation	Timber Framed Construction
3	Maximum Age at Application	Requirement to be a Homeowner	Mortgage or Secured Loan Arrears or Defaults	Non-standard Construction
4	Help to Buy Equity Loan Scheme	Houses of Multiple Occupation (HMO)	Debt Management Plan - Ongoing / Current	Ex-Local Authority Houses
5	Capital Raising for Debt Consolidation	First Time Buyers	Capital Raising - Home Improvements	Property with an Annex / Outbuildings / Land / Acreage

	SELF BUILD	BRIDGING	OVERSEAS	COMMERCIAL
1	Maximum Loan to Value	Regulated Bridging	Maximum Loan to Value	Maximum Loan to Value
2	Maximum Loan Amount	Adverse Credit	Retained Profit in Company	Semi-Commercial Properties
3	Custom Build - Maximum Loan to Cost	Bridging - Minimum Loan	Affordability Calculator	Commercial Investment Mortgages
4	Number of Stage Payments / Releases	Maximum LTV for Bridging	Expatriates	Maximum LTV for Commercial Investment
5	Residential Mortgage in the Background to Remain	Bridging - Maximum Loan	Maximum Loan Amount	Maximum Period for Interest Only

Nicola Firth, CEO of Knowledge Bank said, “As we head into the second quarter of 2019, the landscape for brokers advising clients continues to be more and more complicated. Everyone in the housing market is reacting to external financial and competitive forces within a period of unprecedented change with Brexit, and mortgage and loan providers are no exception.

“There are daily changes to both products and their underlying criteria so the task facing brokers in delivering advice is harder than ever. However, the reality for brokers is that borrowers are unaware or unconcerned as long as they can be paired with the right product from the right lender. This is why technology is crucial in helping brokers find the right product the first time.”