What makes brokers’ top five criteria searches?

New research from criteria search specialist Knowledge Bank showed a potentially worrying development in borrowers’ credit worthiness as the search for lenders accepting applicants with ‘missed or late payments’ enters the top five criteria searches in May.

Knowledge Bank’s criteria tracker reveals brokers’ most common criteria searches to find lenders who will consider their clients.

The search for ‘missed or late payments’ follows recent trends in increasing interest rates and the much-publicised cost-of-living crisis with fuel, food and energy bills rising exponentially for households.

Knowledge Bank chief executive Nicola Firth (pictured) said that although arrears are trending downwards, this could serve as a warning of impending criteria tightening.

“With interest rates rising and household bills taking up an increasing share of household income, affordability looks set to be impacted and lenders will be forced to adapt criteria accordingly. Lenders are very aware that household incomes are being adversely affected by cost-of-living rises and so are likely to tweak their criteria to ensure a high level of responsible lending,” Firth elaborated.

Read more: Rising interest rates to impact brokers' searches – Knowledge Bank.

Like the three months preceding last month, brokers’ favourite residential loan search in May was ‘Maximum age at end of term’ as borrowers look to extend the life of their mortgage term.

Also in the residential loan category, the search for ‘Self-employed with one year’s accounts’ jumps up to second place after only entering the top five last month.

Knowledge Bank noted that the buy-to-let sector continues to be a hive of broker activity and for the third month in a row, it is potential ‘first-time landlords’ looking for a lender that is the top search.

This is followed closely in second place by brokers searching for buy-to-let lenders who will consider lending to limited companies.

The most common search for clients with bridging needs remained consistent in May with ‘regulated bridging’ taking the top spot, followed closely by ‘minimum loan amount’ and ‘maximum LTV’.

Like the commercial sector, activity in the bridging sector remained robust throughout May with the number of broker searches increasing month-on-month.

The top five searches in the commercial sector had a new entrant in May as brokers searched for lenders who would consider ‘mixed use properties that are part commercial’. This search breaks back into the top five searches for the first time since January.

“With interest rates and mortgage rates set to rise throughout the year, there is an increasing pressure on brokers to secure a product for their client while rates are still affordable. As the rush for the last remaining low rates heats up, brokers can avoid wasted time in the application process simply be checking criteria conditions prior to a product search,” Firth said.