Bank of Mum & Dad feature in Knowledge Bank’s criteria

Michael Lloyd

September 6, 2018

The Bank of Mum and Dad featured in Knowledge Bank’s criteria activity tracker, with joint borrower sole proprietor as the most searched criteria by brokers within the residential sector in August.

These types of products are typically designed to allow close family members to help with a mortgage application and most commonly it is the Bank of Mum and Dad that is the source of the funds as the parents can use their income as the second applicant.

Other top searches in the residential sector included the maximum age allowed at the end of the term, maximum LTV and a search for lenders who would allow capital raising for debt consolidation.

Nicola Firth, chief executive of Knowledge Bank said: “Although August is traditionally a quiet month in the industry we’ve seen no slow up in broker’s activity in their effort to see where their clients will fit ever-changing lending criteria.

“Feedback from brokers over the month suggests that because of the base rate increase borrowers have a greater than before level of uncertainty about the products on offer and their ability to qualify for them.

“Coupled to this is evidence of a raft of lenders tweaking and refining their criteria in tandem with price changes as a result of what is only the second base rate rise in over a decade.

“This market uncertainty is a perfect example of where criteria sourcing can pay huge dividends.

“Brokers seem to be really switched on to the fact that a quick source of criteria against a client’s circumstances can offer reassurance for exiting applications and also generate new lending opportunities.”

Within buy-to-let lending this month’s rankings remain fairly consistent from July, although the search for lenders who accept first-time landlords takes the top spot for the first time.

It’s also worth noting that ‘complex buy-to-let’ changes have been made by multiple lenders this month although this is yet to break into the top five.

As a result this is an area that brokers should definitely consider double checking before placing a case as changes can happen thick and fast in this sector.

Other results of note include the self-build sector where the top search conducted is for lenders allowing capital raising for land purchase, which suggests a continuing appetite for this market.

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