October’s criteria searches reveal max LTV growing in importance
06 November 2018
Knowledge Bank’s Criteria Activity Tracker for October has revealed a growing focus on maximum LTVs. Maximum LTVs was in the top five of almost every one of the eight different lending types that Knowledge Bank enables brokers to search on.
In mainstream residential searches, it was brokers’ third most searched item. For Second Charges, maximum LTVs was the most searched for criteria, while for Commercial Loans, Equity Release and Self Build it was second most searched for. In buy-to-let, it came in fourth place as it did for Bridging Loans, but here brokers searched which lenders would lend up to 100% of the purchase price of the property.
Knowledge Bank contains over 70,000 pieces of criteria, so it is interesting out of the huge number of results that could come up, that maximum borrowing limit is such a priority for borrowers. Despite political uncertainty, it reveals a high level of consumer confidence that borrowers still feel confident to borrow the maximum they possibly can against any new property.
A number of the other searches also show the extent to which Brits are prepared to take chances and carve out their own financial fortunes. The fact that lending to the self employed is still the number one most searched for criteria in residential mortgages for the second month running, shows that a large number of people are not taking what may be considered the easy or secure option of working for others but are instead continuing to go it alone.
Investment in property still appears to be considered as providing a level of security. In buy-to-let, two of the top three searches are for first time landlords and first time buyers, so the appeal of rental property appears to be little diminished at least at the enquiry stage, even for those who have not yet entered the housing market.
It also reveals what is already starting to be seen as a trend where rental property is concerned. While new buyers may still be interested in entering the mainstream buy-to-let market, there appears to be a growing shift in the make up of the rental market. The search for limited company buy-to-let moved up from third to second most searched for term in buy-to-let, while the top commercial lending search term was for commercial investment mortgages. Lending to limited companies overseas was the top search in this category, all of which indicates that perhaps existing investors are looking to diversify their investment portfolio.
The charts below reveal the top five searches for the eight lending types on Knowledge Bank. Brokers receive results from over 165 lenders across 70,000 different search criteria making it the largest source of criteria data in the mortgage industry.
Top five searches performed by brokers on Knowledge Bank by brokers during October 2018:
Nicola Firth, CEO of Knowledge Bank said,
“There is a growing demand for high LTV lending. What we see here is the very start of the process, so what it is that borrowers are really interested in, it will be fascinating to see the UK Finance lending statistics as they appear over the next few months as to just how much the number of high LTV loans increases.
“What these searches do highlight is an interesting snapshot into what the actual demand is. The bit that brokers then get to see is the lenders that actually cater for their clients’ needs. As the number of lenders with their criteria on Knowledge Bank continues to grow, brokers are increasingly finding that they can find a mortgage even for the most complex client’s needs, often from lenders that they would never have considered, or even been aware of before.”
