According to the Knowledge Bank’s criteria index for the month, this is the first time the term has entered the top five most searched residential criteria in six months. The criteria sourcing provider said this hinted at a decline in borrowers’ financial circumstances.
Searches for the maximum age at the end of a mortgage term remained top for brokers with residential clients, suggesting borrowers were looking to spread repayments over longer periods.
In September, 35 per cent of mortgage criteria changes registered on the Knowledge Bank system occurred within the residential space while a third happened within the buy-to-let sector.
Broker criteria searches for buy-to-let borrowers remained consistent, with ‘lending to limited companies’ and ‘first-time landlords’ appearing as the top two searches for the sixth month running.
There were two new search terms in the top five for equity release brokers compared to August as advisers looked for lenders that would lend on properties with an annex and criteria which would permit debt management plans.
Searches for bridging and commercial borrowers stayed the same as the previous month while the sector accounted for 15 per cent of criteria updates in September.
Nicola Firth (pictured), CEO of Knowledge Bank, said: “Mortgage brokers continue to work tirelessly to place their clients’ mortgages in the face of daily product and criteria changes at an unprecedented level and this month revealed some worrying changes
“Additionally, there were other signs that borrowers are in a declining financial position as they look to add lenders fees to the loans and the popularity of searches for equity release products for properties with an annex suggest households are consolidating their living arrangements.”
She added: “As we hear that completions are now taking over 20 weeks, the problem for borrowers is that their mortgage offer could run out prior to completion. As a result, brokers will need to re-broke the deal meaning that they are effectively doing their job twice and only being paid once.
“This is why it’s absolutely crucial to keep on top of criteria changes and be prepared to switch lenders as required.”