The top criteria searches in the second charge mortgage market in January related to managing or consolidating debt, according to new findings from Knowledge Bank.

The criteria search specialist found that four of the top five second charge searches it recorded were new terms for the month, and included those with CCJs looking to second charge loans for finance.

Knowledge Bank suggested the trend demonstrates a number of people are struggling financially and are using their homes to secure debt against. The one constant search term in January was “Maximum LTV”, which has been the top searched second charge criteria since May 2019.

January saw 3,000 criteria changes on the Knowledge Bank database of mortgage lending criteria, following a record 52,000 changes that were recorded over the course of 2020.

For the first time since August, the findings revealed that “Furloughed workers” became the top searched terms in the residential market again. Knowledge Bank suggested this shows that brokers were working with an increasing number of clients on the job support scheme, who were potentially struggling to get a mortgage.

Knowledge Bank’s analysis also revealed that “First-time buyers” reached the top five search terms in the buy-to-let (BTL) market for the first time since February. The criteria expert said this could be an option for those whose income is not high enough to afford a mortgage, but have a large deposit and want to invest in property.

“As we move into 2021, the mortgage market continues to shift dramatically,” said Knowledge Bank operations director, Matthew Corker. “There is significant interest in debt consolidation in the second charge market, while the BTL sector continues to attract interest from both potential and existing investors.

“The furlough scheme is at the top of brokers requests in the residential category as thousands of families are, or have now been, affected by being on furlough. Just how supportive lenders will be of those that have been on the scheme is still being established.

“With the end of both the stamp duty holiday and furlough scheme, lenders are certain to continue adapting criteria to keep up with the evolving market. It is now physically impossible for any mortgage broker to keep all the different criteria in their heads.”

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